Washington

Media General Confirms Incentive Auction Participation

Says it will get its applications in by deadline 1/07/2016 09:54:00 AM Eastern

As part of its announced deal to be purchased by Nexstar if Media General can get out of its agreement to merge with Meredith, Media General confirmed that it plans to file applications to participate in the FCC broadcast incentive auction.

Those applications are due Jan. 12.

FCC auction rules prevent potential participants—Jan. 12 is just the first step—from discussing bidding strategies but do allow TV station owners to say if they are applying for the auction. The FCC will keep the identities of the particular stations confidential, in the case of winning bidders until the auction is over and losing bidders for two years thereafter.

The FCC is expecting strong interest from TV station owners given the opening bid prices—in the hundreds of millions. That could particularly be attractive to smaller stations and weaker members of duopolies in larger markets.

Being a winning bidder in the incentive auction would also be a way to spin off stations to the FCC auction, rather than divest them to another buyer.

"The bidding battle for Media General by Nexstar and Meredith points out the enduring value of pure-play television and the importance of broadcast spectrum," said Adonis Hoffman, chairman of Business in the Public Interest and former chief of staff to FCC Commissioner Mignon Clyburn. "I think it is altogether positive for the industry that Media General is drawing such interest from two solid companies.  I also believe this may be a precursor for the remaining television groups in this space."

"Nexstar is expected to file merger papers with the FCC today," Hoffman said, "but its deal cannot go through until Meredith is off the table. Both Nexstar and Media General are likely to participate in the incentive auction, and the proposed transaction should not be an impediment to their involvement."

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