It’s been an eventful decade for Nexstar, but it’s the past 16 months that have been particularly momentous for the local broadcaster. Chairman, president and CEO Perry Sook was in Times Square Nov. 26 to ring the opening bell at NASDAQ, marking 10 years as a publicly traded company, and afterwards reflected on the next 10 years. Nexstar went public at $14 a share in 2003, he says, with a $140 million market capitalization, and sits at $48.85 at presstime. Nexstar’s market capitalization has grown tenfold, says Sook — to north of $1.4 billion.
“It was hard for some people to imagine when we founded the company in 1996, with one station, that we would grow our portfolio to 102 stations,” Sook told B&C. “But for our leadership team, that was our vision, our dream and our goal.”
Much of the leadership team, including executive VP and co-COOs Brian Jones and Tim Busch, executive VP and CFO Tom Carter, was in New York for the occasion. “We had a robust group at the podium,” says Sook.
Nexstar’s acquisitions of late include a dozen Newport TV stations at $285.5 million, the CCA stations for $270 million, the Grant group for $87.5 million and some from Citadel for $88 million.
The deal-making began in earnest after Nexstar announced its plans to “explore strategic alternatives,” including a sale, in July 2011. After a year of such exploration, Sook says the best path was full-scale M&A.
“We explored all options and decided the best way to create value for shareholders was to embark on a path of strategic and accretive acquisitions,” he says.
The future should be similarly acquisitive for Nexstar, though not at the same torrid pace the past year and a half has been. Sook has frequently said scale is not so much the goal as the byproduct of strategic and accretive deals. He says the existing management team could run a company doing twice the revenue as it’s doing now, but Nexstar will not grow for scale’s sake.
“It would be hard to do it at the pace we’ve done it at the last 16 months,” he says.
Stations and digital media companies that complement Nexstar’s local content will continue to be targets. Nexstar recently hired Tom O’Brien to be executive VP of digital media and chief revenue officer.
Sook was prophetic in recent years in identifying a dozen or so super-groups still standing after all the consolidation. Once that shakes out, he says mergers, not so much acquisitions, will represent the best path to growth for such “too big to buy” broadcasters.
“We are interested in those conversations,” he says, “and can be on either side of the table for them.”