Nexstar Broadcasting Group, Inc. (Nasdaq: NXST) (“Nexstar”) announced today that it entered into definitive agreements with Marshall Broadcasting Group, Inc. (“MBG”) for the sale of three network affiliated stations (“the stations”) in three markets for $58.5 million. MBG intends to fund the station acquisitions through borrowings which Nexstar has agreed to guarantee.
For over two decades, the Federal Communications Commission (“FCC”) has advanced proposals for the incubation of broadcast station ownership by disadvantaged businesses, including minority-owned companies. FCC data indicates that African-American ownership of television stations is abysmally low, with African-Americans controlling only 0.7% of all television broadcast stations. Under the terms of the agreements MBG will acquire three full-powered, FOX affiliated stations, KMSS-TV, KPEJ-TV and KLJB (TV) in Shreveport, LA, Odessa-Midland, TX and Quad Cities, IA, respectively.
Perry A. Sook, Chairman, President and Chief Executive Officer of Nexstar Broadcasting Group, Inc., commented, “We believe the proposed transaction announced today presents an ideal framework for introducing and incubating a new, minority-controlled entrant to broadcasting, and for bringing additional news, information and specialized programming to MBG’s markets at the earliest possible opportunity.”
The transactions are subject to Federal Communications Commission approval, the consummation of Nexstar’s previously announced agreements to acquire the stock of privately-held Communications Corporation of America and White Knight Broadcasting (“CCA”) and the stock of Grant Company, Inc. (“Grant”), and other customary closing conditions, and are expected to be completed in 2014. Subject to regulatory approval, MBG intends to assume the obligations of Mission Broadcasting, Inc. (“Mission”) as the acquirer of the Stations under various asset purchase agreements currently in effect between Nexstar and Mission.Marshall Broadcasting Group, Inc. is a newly formed minority owned media entity owned 100% by Pluria Marshall Jr. Mr. Marshall is currently the president and chief executive officer of Equal Access Media Inc., which owns several newspapers serving African-American and minority communities, including The Texas Freeman and Houston Informer Newspapers, The Los Angeles Wave Newspaper Group, and the Los Angeles Independent Publications Group. In 2011, Mr. Marshall founded Integrated Multicultural Media Solutions, a media rep firm that assists advertisers and agencies in marketing products and services to multicultural audiences by providing marketing services, including promotions, grassroots marketing, advertising placement and custom content creation.