Waiting for Freedom to burst forth


Radio has had a couple of big transactions already this year, but television is still waiting for the first post-recession deal to re-set the meter for M&A. That could come soon.

People in television have been talking for weeks about the auction of Freedom Communications, which emerged from Chapter 11 reorganization last April. It is widely known that bids were due Thursday (3/10), but not much more about how the sale process is going.

The bidding is quite complicated. According to the Wall Street Journal, bids were being accepted for the whole company, the eight-station TV group alone, the 100+ daily and weekly newspapers sans TV and even for the flagship Orange County Register alone. The WSJ article speculated that the TV group could fetch $400 million, eight times EBITDA, and the newspapers $350 million, four times EBITDA.

RBR-TVBR observation: Eight times EBITDA seems pretty low for TV, given the recent multiples in big radio deals and the perception that TV stations are more valuable due to retrans and political. We have no idea what newspapers should sell for – except that we would not want to invest in that diminishing business.