Investments |
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments | Note 4: Investments The Company’s investments and their book value balances consisted of the following (in millions):
Equity Method Investments During the three and six months ended June 30, 2022, the Company received cash distributions from its equity method investments, primarily from its investment in TV Food Network, as discussed below. During the three and six months ended June 30, 2022 and 2021, the income from equity method investments, net reported in the Company’s unaudited Condensed Consolidated Statements of Operations consisted of the following (in millions):
At acquisition date, the Company measured its estimated share of the differences between the estimated fair values and carrying values (the “basis difference”) of the investees’ tangible assets and amortizable intangible assets had the fair value of the investments been allocated to the identifiable assets of the investees in accordance with ASC Topic 805, “Business Combinations.” Additionally, the Company measured its estimated share of the basis difference attributable to investees’ goodwill. The Company amortizes its share of the basis differences attributable to tangible assets and intangible long-lived assets of investees, including TV Food Network, and records the amortization (the “amortization of basis difference”) as a reduction of income from equity method investments, net in the accompanying Condensed Consolidated Statements of Operations. The Company’s share in these basis differences and related amortization is primarily attributable to its investment in TV Food Network (discussed in more detail below). Investment in TV Food Network Nexstar acquired its 31.3% equity investment in TV Food Network through its acquisition of Tribune Media Company (“Tribune”) on September 19, 2019. Nexstar’s partner in TV Food Network is Warner Bros. Discovery, Inc. (“WBD”), formerly known as Discovery, Inc., which owns a 68.7% interest in TV Food Network and operates the network on behalf of the partnership. TV Food Network owns and operates “The Food Network,” a 24-hour lifestyle cable television channel focusing on food and related topics. TV Food Network also owns and operates “The Cooking Channel,” a cable television channel primarily devoted to cooking instruction, food information and other related topics. TV Food Network’s programming is distributed by cable and satellite television systems and via WBD’s streaming platform, Discovery+. The partnership agreement governing TV Food Network provides that the partnership shall, unless certain actions are taken by the partners, dissolve and commence winding up and liquidating TV Food Network upon the first to occur of certain enumerated liquidating events, one of which is a specified date of December 31, 2022. Nexstar intends to renew its partnership agreement with WBD for TV Food Network before expiration. In the event of a liquidation, Nexstar would be entitled to its proportionate share of distributions to partners, which the partnership agreement provides would occur as promptly as is consistent with obtaining fair market value for the assets of TV Food Network. The partnership agreement also provides that the partnership may be continued or reconstituted in certain circumstances. As of June 30, 2022, Nexstar’s investment in TV Food Network had a book value of $1.042 billion, compared to $1.191 billion as of December 31, 2021. As of June 30, 2022, Nexstar had a remaining share in amortizable basis difference of $501.3 million related to its investment in TV Food Network. This amortizable basis difference had a weighted average useful life of approximately 3.8 years as of this date. As of December 31, 2021, Nexstar had a remaining share in amortizable basis difference of $536.1 million related to its investment in TV Food Network. During the three months ended June 30, 2022, the Company received cash distributions from TV Food Network of $31.0 million, recognized income on equity of this investment of $54.0 million, and recorded amortization of basis difference (expense) related to this investment of $17.4 million. During the six months ended June 30, 2022, the Company received cash distributions from TV Food Network of $223.8 million, recognized income on equity of this investment of $110.0 million, and recorded amortization of basis difference (expense) related to this investment of $34.8 million. Summarized financial information for TV Food Network is as follows (in millions):
During the three and six months ended June 30, 2022, there were no events or changes in circumstance that triggered the Company for an evaluation of its equity method investments for other-than-temporary impairment. |