Magazine

Sinclair Broadcast: Offers in the Air?


Is Sinclair Broadcast Group (SBGI) on the block? It may be, if the Smith family wants to do a deal. Headed by CEO David Smith, the Smiths control 91% of the Class B voting stock. Some large institutions own Class A stock, including Neuberger Berman, with 15%, and Citigroup (C), with 10%. The stock has tumbled--from 13.75 on Jul. 11, 2000, to 9 on Jun. 6, 2001--because of weak ad sales. The stock trades "at the lowest multiple in the TV group," notes Andrew Marcus of Deutsche Bank Alex. Brown. Yet he rates the stock a buy--because it is trading at only half Sinclair's estimated asset value of 16 to 20 a share. Sinclair owns 62 TV stations in 40 mid-markets, including major network affiliates. Fox affiliates account for 34% of broadcast revenues, and WB affiliates, 32%. Whispers are that a couple of media biggies have talked to Sinclair about a buyout. Its undervalued assets, plus some pending regulatory changes, make Sinclair a likely target, say these pros. Scott Davis of First Union Securities says that anticipated rule changes, such as lifting the national-ownership cap and the restriction on cross-ownership with newspapers, would make it possible for Fox or Tribune to buy Sinclair. CEO Smith wasn't available for comment. By Gene G. Marcial


Race, Class, and the Future of Ferguson
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

 
blog comments powered by Disqus