Tribune Co. (TRBAA) reached a $2.73 billion agreement to acquire
all 19 of Local TV Holdings LLC's television stations, a move that
will transform Tribune into the largest commercial TV station owner
in the U.S.
The list of potential bidders for Local TV had included Sinclair
Broadcast Group Inc. (SBGI), Meredith Corp. (MDP), Tribune and
others.
The acquisition of Local TV, owned by private-equity firm Oak
Hill Capital Partners, will increase Tribune's stations in the U.S.
to 42. Tribune, owner of a string of newspapers and broadcast
stations, emerged from bankruptcy protection at the end of 2012,
after a prolonged fight over confirmation of its Chapter 11
plan.
The deal is expected to provide scale that will allow Tribune to
expand its advertising and video and digital distribution
opportunities and provide a stronger position in negotiations with
affilates about distribution.
Tribune expects the combination will generate more than $100
million in annual savings within five years after the deal closes,
which is expected by year's end.
Tribune has received committed financing of up to $4.1 billion
from J.P. Morgan Chase & Co. (JPM), Bank of America Corp.'s
(BAC) BofA Merrill Lynch arm, Citigroup Inc. (C), Deutsche Bank AG
(DB) and Credit Suisse Group AG (CS, CSGN.VX), including a new $300
million revolving credit facility and the capacity to allow Tribune
to refinance its existing debt.
Tribune shares closed Friday at $56.90 and were inactive
premarket.
Write to Tess Stynes at Tess.Stynes@dowjones.com
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