BALTIMORE, Feb. 1 /PRNewswire-FirstCall/ -- Sinclair Broadcast Group,
Inc. (Nasdaq: SBGI), announced today that they have purchased the
non-licensed assets of KFXA-TV (FOX 28) in Cedar Rapids, Iowa for $17.1
million in cash from Second Generation of Iowa, Ltd and obtained the right
to purchase the licensed assets, pending FCC approval, for $1.9 million.
Sinclair also owns KGAN-TV (CBS 2) in Cedar Rapids.
"Today's acquisition is an important step in ensuring the continued
viability of both stations in a small market," commented David Smith,
President and CEO of Sinclair. "This step will allow us to continue the
combination of certain operations of KFXA-TV and KGAN-TV allowing us to
continue to recognize the economic efficiencies necessary to provide a
small market with a meaningful local news presence, a service which we
believe to be of the utmost importance to the community."
Smith continued, "Our relationship with Second Generation has been a
very positive one over the years, however, in today's world of increased
competition for advertising dollars and fragmentation of audience viewing,
it is more difficult to operate a full-scale television operation in a
small market without the benefit of combined efficiencies. Although we
believe that both parties have worked to manage the stations for the
betterment of the Cedar Rapids marketplace, there is still more that can be
done if we are permitted to acquire KFXA's license assets. Both parties,
however, are limited as to what can be accomplished operating alone. The
purchase of KFXA- TV's non-license assets and the eventual purchase of its
license assets following FCC approval should allow us to make both stations
operate more efficiently. We expect this to be an accretive acquisition."
Matthew Embrescia, President of Second Generation added, "We are
pleased to continue our relationship with Sinclair Broadcast Group to build
value for our Fox affiliate and the community."
KFXA-TV has been providing sales and other non-programming related
services to KGAN-TV since August 2002 under an outsourcing agreement. As
part of today's sale agreement, Sinclair's KGAN-TV will no longer receive
such services from KFXA-TV, but will instead provide such services to
KFXA-TV, while Second Generation will continue to program KFXA-TV and
perform other functions as the licensee of KFXA-TV.
About Sinclair
Sinclair Broadcast Group, Inc., one of the largest and most diversified
television broadcasting companies, owns and operates, programs or provides
sales services to 58 television stations in 35 markets. Sinclair's
television group reaches approximately 22% of U.S. television households
and is affiliated with all major networks. Sinclair also holds investments
in various other lines of businesses. For more information, visit the
Sinclair website at http://www.sbgi.net.
Forward-Looking Statements:
The matters discussed in this press release, particularly those in the
section labeled "Outlook," include forward-looking statements regarding,
among other things, future operating results. When used in this press
release, the words "outlook," "intends to," "believes," "anticipates,"
"expects," "achieves," and similar expressions are intended to identify
forward-looking statements. Such statements are subject to a number of
risks and uncertainties. Actual results in the future could differ
materially and adversely from those described in the forward-looking
statements as a result of various important factors, including and in
addition to the assumptions identified in this release, the impact of
changes in national and regional economies, successful execution of
outsourcing agreements, pricing and demand fluctuations in local and
national advertising, volatility in programming costs, the market
acceptance of new programming, the CW Television Network and MyNetworkTV
programming, our news share strategy, our local sales initiatives, the
execution of retransmission consent agreements and the other risk factors
set forth in the Company's most recent reports on Form 10-Q and Form 10-K,
as filed with the Securities and Exchange Commission. There can be no
assurances that the assumptions and other factors referred to in this
release will occur. The Company undertakes no obligation to publicly
release the result of any revisions to these forward-looking statements
except as required by law.
SOURCE Sinclair Broadcast Group
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Related links:
http://www.sbgi.net
http://www.prnewswire.com/comp/110203.html/
CONTACT:
David Amy, EVP & CFO, Sinclair Broadcast
Group, Inc. or Lucy Rutishauser, VP Finance & Treasurer,
+1-410-568-1500
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