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TheStreet Open House

Gray Television Jumps on More TV Station Consolidation

Stocks in this article: GTN SBGI

NEW YORK (TheStreet) -- Gray Television (GTN - Get Report) was gaining on Monday as the television station operator said it will acquire Yellowstone Television's four stations in a deal valued at $23 million.

The transaction, which is expected to immediately add to the Atlanta-based company's earnings, will give Gray a total of 49 stations representing one of the four major U.S. broadcasters. Yellowstone owns an NBC-affiliated station in Laredo, Texas and a CBS station in Cheyenne, Wyoming, among others.

Wells Fargo media analyst Marci Ryvicker called the acquisition a "nice tuck-in deal." Gray's national reach covers 7.7% of U.S. television households.  Shares of Gray were rising 4.7% to $8.73, extending the company's 2013 advance to 297%.

The Yellowstone deal follows television station acquisitions earlier this year that are reshaping the industry.

In June, Media General (MEG) merged with  New Young Broadcasting Holding in an $860 million deal backed by Warren Buffett and Mario Gabelli, that created a company owning 30-network affiliated stations reaching about 16.5 million U.S. TV households.

In July, Tribune TRBAA the Chicago-based media company that came out of a painful bankruptcy at the end of 2012, announced plans to acquire privately-held Local TV Holdings for $2.725 billion in cash, creating a company owning 42 local TV stations covering 39% of U.S. TV households.

And in late July, Sinclair Broadcast Group, (SBGI - Get Report), the largest single U.S. owner of TV stations, paid $985 million for seven ABC-affiliated stations owned by the Allbritton family along with a 24-hour Washington D.C.-based cable channel. Sinclair owns 149 network-affiliated TV stations for a coverage of 38%, according to its Web site.

By Leon Lazaroff in New York



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