• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

Channel 10 to Be Sold to Virginia Company

Posted on: Friday, 7 April 2006, 15:00 CDT

By Timothy C. Barmann, The Providence Journal, R.I.

Apr. 7--WJAR Channel 10, Rhode Island's most-watched television station, will be sold to a Virginia-based newspaper and TV company.

Media General Inc., of Richmond, said yesterday it agreed to buy WJAR and three other NBC-owned-and-operated stations for $600 million in cash.

The sale, which is subject to approval by the Federal Communications Commission and the Department of Justice, is expected to close in the second or third quarter, Media General said.

The change in ownership should not be visible to Channel 10 viewers, said Lisa G. Churchville, NBC 10's president and general manager. No staff changes or layoffs are planned, she said.

"This should be transparent, no difference whatsoever," she said. The station will remain an NBC affiliate, and its programming and community involvement will not change, she said.

"This is a particularly good match for us, so that is wonderful," she said.

Channel 10 investigative reporter Jim Taricani said that he and others at the station were pleased that the buyer is a media company that emphasizes good journalism.

"We're all really glad it's a journalism organization both with television stations and newspapers," Taricani said in a telephone interview. "We have a pretty dedicated staff, and we were hoping for a company like that that focuses on journalism."

The sale comes at a turbulent time for local TV stations, which depend almost entirely on advertising revenue. Ad sales were soft last year, particularly those bought by national ad firms, said Gary Chapman, president and chief executive officer of LIN Television of Providence. LIN TV owns or operates 30 TV stations in the U.S. and Puerto Rico. Locally, it owns WPRI Channel 12, and it operates WNAC Fox 64.

Media companies also are trying to map their business strategies in light of possible regulatory changes. FCC Chairman Kevin Martin supports lifting the 31-year-old federal ban on the ownership of both newspapers and TV stations in the same city.

NBC Universal, WJAR's owner, had said in January that it intended to sell the Providence station, along with three others. (NBC Universal is 80-percent owned by General Electric, the parent company of NBC, and 20-percent by Vivendi Universal.)

It wanted to sell so it could focus on the six major markets where it owns and operates two stations -- one that carries NBC programming, and another that carries Telemundo programming, said Jay Ireland, president of the NBC Universal Television Stations. (The Spanish-language Telemundo network is also owned by NBC Universal.)

Besides the Providence station, the other NBC Universal stations Media General plans to buy are WNCN in Raleigh, N.C., WCMH in Columbus, Ohio, and WVTM in Birmingham, Ala.

The four stations had gross revenues of $120 million last year, according to Media General. The sale price is 14 times the annual cash flow of the four stations, calculated by averaging figures from 2004 and 2005.

Media General owns three metropolitan newspapers -- The Tampa Tribune, Richmond Times-Dispatch, and Winston-Salem Journal, 122 daily and weekly community newspapers, and 26 network-affiliated TV stations. Most of its properties are concentrated in the Southeast.

The company will sell three stations, CBS affiliates in Wichita, Kan., Mason City, Iowa, and Chattanooga, Tenn., to help pay for the purchase of the NBC stations. It will also sell its station in Birmingham, Ala., to comply with the FCC ownership rules.

Marshall N. Morton, president and chief executive officer of Media General, told financial analysts in a conference call yesterday that the company will bring its "revenue development initiatives" to the four stations. Company spokesman Ray Kozakewicz said those programs involve comprehensive, sophisticated training programs for its sales representatives designed to increase advertising buys.

Morton noted that WJAR is the number-one station in the Providence market.

WJAR has changed hands before. In 1996, NBC acquired Outlet Communications -- which owned a station in Columbus, Ohio, and one in Raleigh-Durham, N.C., as well as Channel 10 -- in a deal valued at $396 million.

WJAR now has 120 employees, and produces 26 hours of local news programming each week. It enjoys top viewership ratings in Providence. For the last ratings period, February 2006, 22 percent of those watching TV at 6 p.m. were tuned to Channel 10 news, according to figures provided by WJAR. During that period, WPRI Channel 12 had a 13-percent share of viewership, and WLNE Channel 6 had 6 percent.

WLNE is owned by Freedom Communications, which is owned in part by a locally based private equity firm, Providence Equity Partners.

Chapman, the LIN TV CEO, said he welcomes Media General to Rhode Island, and that its entry will be good for the market.

"Like ourselves, they put an emphasis on news and community involvement. They're good citizens. That's the kind of operators you'd want to have come in no matter what business you're doing."

Jay Howell, general manager of LIN TV's Channel 12, said the sale shows companies are willing to invest top dollar in local TV stations.

He does not expect to see any on-air changes in the immediate future at WJAR. "They are obviously a very strong station, and I doubt we would see many changes in the short-term."

In the longer term, Howell points out that the Media General Web site refers to its concentration in the Southeast and wondered how a station in New England plays into its corporate strategy.

"Are they going to be a long-term player here, or did they buy Providence in order to get stations they want in Birmingham or Raleigh?" he said.

With reports from staff writer Andy Smith.

-----

To see more of the The Providence Journal, or to subscribe to the newspaper, go to http://www.projo.com.

Copyright (c) 2006, The Providence Journal, R.I.

Distributed by Knight Ridder/Tribune Business News.

For information on republishing this content, contact us at (800) 661-2511 (U.S.), (213) 237-4914 (worldwide), fax (213) 237-6515, or e-mail reprints@krtinfo.com.

MEG, GE, V, OCOMA,

Source: Providence Journal

More News in this Category