Sinclair Broadcast Group Inc. will sell WTTV(TV) Indianapolis and satellite
station WTTK(TV) in Kokomo, Ind., to Tribune Co. for $125 million.
Tribune already owns WXIN(TV) Indianapolis.
The deal, if approved by the Federal Communications Commission,
will give Tribune Broadcasting 24 stations with a combined reach of 38.4 percent
of U.S. television households and nearly 29 percent with
FCC discounts for UHF stations.
Sinclair president and CEO David Smith said, 'Since we were not able to create a duopoly in the
Indianapolis/Bloomington market, it made more sense at this time to exit.'
Sinclair said the $125 million price represented 38 times WTTV's
2001 cash flow and an estimated 21-times multiple of the broadcast cash flow
anticipated in 2002, before duopoly benefits.
Tribune added that the price 'represents a multiple
of 11 [times] pro forma 2002 EBITDA [earnings before interest, taxes, debt
and amortization], including duopoly savings.'
Tribune estimated $5 million in savings within the first
year in reduced programming costs and staff reductions.