The FCC has approved the license transfer of Grant Company stations to Nexstar Broadcasting and Marshall Broadcasting.
Nexstar bought Grant’s seven stations for $87.5 million in 2013. Marshall Broadcasting (MBG) is a minority owned station group with Nexstar’s financial backing.
“We are pleased to announce approval of an accretive transaction to benefit Nexstar shareholders,” Perry A. Sook, chairman, president and CEO of Nexstar said in a statement. “As a result of this approval, Nexstar will lead the industry in incubating a new, minority-controlled entrant to broadcasting and bringing additional news, information and specialized programming to markets where MBG will operate.”
The stations involved are CW and FOX affiliate WFXR-WWCW in Roanoke and Lynchburg, Va., FOX affiliate WZDX in Huntsville, Ala, CW affiliate KGCW and FOX affiliate KLJB in Quad Cities, and FOX affiliates WLAX-WEUX in LaCrosse, Wisc.
In a previous release Nexstar outlined a previous financial agreement with Marshall.
Under the terms of the proposed services agreements between Nexstar and MBG, MBG will be entitled to 70% of the revenue from advertising sold by Nexstar on the stations and will not provide for any bonus payments to Nexstar for achieving revenue goals. It will not be a fixed-fee payment; as total revenues increase, so does MBG’s share. This transaction structure provides MBG with incentive to seek the best programming and thus maximize station advertising revenue while providing significant cost savings benefits to MBG related to the use of Nexstar resources that are not associated with control of the stations or their programming.
Sook added, “The MBG transaction serves as a model to increase media ownership diversity while extending Nexstar’s long-term, well-documented initiatives to serve the public interests and needs of local viewers, hometown businesses, and organizations in the markets where we operate.”