Local media ownership takes a hit with deal to sell Fisher's KOMO
Fisher Communications, owner of Seattle’s KOMO-TV and 19 other television stations, will be acquired for $373 million by Sinclair Broadcast Group, the country’s largest Fox affiliate.
Seattle Times business reporter
When KOMO-TV owner Fisher Communications becomes part of the much larger Sinclair Broadcast Group of Baltimore this fall, Seattle will lose its last locally owned network television station.
It also will lose a corporate name that played a prominent part in the region’s economy for just over a century.
Sinclair, the country’s largest Fox affiliate, has agreed to pay $373 million for KOMO and Fisher’s 19 other West Coast TV stations, plus three Seattle radio stations.
Major shareholders — including Fisher’s largest, New York money manager Mario Gabelli — have long pressured the company to sell, as other relatively small broadcast companies have done.
The industry is consolidating in the face of competition from cable television and streaming online videos, as well as media giants such as Rupert Murdoch’s News Corp. and Comcast’s NBC Universal business.
Fisher, one of the country’s smallest publicly traded broadcast companies, spent more than $1 million in 2011 to fight off a slate of board-member candidates who appeared to favor a sale. At the time CEO Colleen Brown called an unsolicited and unofficial offer of $23.99 a share “a lowball level of interest.”
The deal announced Thursday would pay $41 in cash for each Fisher share, a 44 percent premium to the company’s stock price in early January.
Brown said in a news release that Sinclair’s “commitment to the industry — along with its greater scale and sizable resources — will provide our stations, team members and business partners with new opportunities to flourish.”
After this deal and two other pending acquisitions close, Sinclair will own or provide services to 134 television stations in 69 markets.
During the 2004 presidential election, Sinclair was embroiled in political controversy when it ordered stations to play a documentary critical of Democratic candidate John Kerry’s opposition to the Vietnam War.
Sinclair said it plans to keep Fisher’s three Seattle radio stations — KOMO Newsradio, KPLZ STAR 101.5 and KVI 570 — even though its focus is TV.
But an executive seemed to be hedging on that, telling Wall Street analysts during a conference call Thursday, “Our understanding is the radio stations are complementary ... It will take time to verify.”
The company does not anticipate having to divest any TV stations to comply with Federal Communications Commission limits on radio and TV station ownership.
It is selling some stations to complete the $370 million acquisition of Barrington Broadcasting, which owns or manages 24 TV stations from Syracuse, N.Y., to Amarillo, Texas.
That deal was announced in February, as was Sinclair’s agreement to pay $95 million for four TV stations owned by COX Media Group.
Fisher resisted pressure to sell the company for years, instead shedding assets to generate cash for shareholders and expand its media operations.
In 2001, it sold a flour-milling business it had operated for almost a century.
In 2007, it sold its $190 million stake in insurer Safeco. Around that time, it also sold 19 Montana and Eastern Washington radio stations.
And in 2011, it sold six more Montana radio stations and raised $160 million by selling Fisher Plaza, a two-building landmark complex near the Space Needle that houses its headquarters.
In January, Fisher began looking for other options and hired Moelis & Co., the investment-banking firm that advised it on a $10-per-share special cash dividend it paid out last fall.
Sinclair said it will finance the purchase with cash, a bank loan and/or by selling stock or bonds.
Fisher has about 775 employees nationally and does not disclose how many are at its Seattle headquarters.
Asked whether those core employees will keep their jobs, a Fisher spokesman said, “It is premature to speculate about integration planning.”
The deal is subject to antitrust clearance, approval by the FCC and Fisher shareholders.
Melissa Allison: 206-464-3312 or firstname.lastname@example.org. On Twitter: @AllisonSeattle