Acquisitions

9 Months Ended

Sep. 30, 2020

During 2019, we acquired the television stations listed in the table below, and a summary of each acquisition follows:


Market	Station	Affiliation	Seller
Indianapolis, IN	WTHR	NBC	Dispatch Broadcast Group
Columbus, OH	WBNS	CBS	Dispatch Broadcast Group
Hartford-New Haven, CT	WTIC/WCCT	FOX/CW	Nexstar Media Group
Harrisburg-Lancaster-Lebanon-York, PA	WPMT	FOX	Nexstar Media Group
Memphis, TN	WATN/WLMT	ABC/CW	Nexstar Media Group
Wilkes Barre-Scranton, PA	WNEP	ABC	Nexstar Media Group
Des Moines-Ames, IA	WOI/KCWI	ABC/CW	Nexstar Media Group
Huntsville-Decatur-Florence, AL	WZDX	FOX	Nexstar Media Group
Davenport, IA and Rock Island-Moline, IL	WQAD	ABC	Nexstar Media Group
Ft. Smith-Fayetteville-Springdale-Rogers, AR	KFSM	CBS	Nexstar Media Group
Toledo, OH	WTOL	CBS	Gray Television
Midland-Odessa, TX	KWES	NBC	Gray Television

Nexstar Stations

On September 19, 2019, we completed our acquisition of 11 local television stations in eight markets, including eight Big Four affiliates, from Nexstar Media Group (the Nexstar Stations). These stations were divested by Nexstar Media Group in connection with its acquisition of Tribune Media Company. The purchase price for the Nexstar Stations was $769.9 million which included a base purchase price of $740.0 million and working capital of $29.9 million.

Dispatch Stations

On August 8, 2019, we completed the acquisition of Dispatch Broadcast Group’s two top-rated television stations and two radio stations (the Dispatch Stations). The purchase price for the Dispatch Stations was $560.5 million which consisted of a base purchase price of $535.0 million and working capital and cash acquired of $25.5 million.

Justice and Quest Multicast Networks

On June 18, 2019, we completed the acquisition of the remaining approximately 85% interest that we did not previously own in the multicast networks Justice Network (recently rebranded as True Crime Network) and Quest from Cooper Media. Cash paid for this acquisition was $77.1 million (which included $4.6 million for working capital).

Gray Stations

On January 2, 2019, we completed our acquisition of WTOL and KWES from Gray Television, Inc. for $109.9 million in cash (which included $4.9 million for working capital paid at closing).

The following table summarizes the fair values of the assets acquired and liabilities assumed in connection with these acquisitions (in thousands):


	Nexstar Stations		Dispatch Stations		Justice & Quest		Gray Stations		Total

Cash	$	—	$	2,363	$	—	$	—	$	2,363
Accounts receivable	34,680		26,344		8,501		5,553		75,078
Prepaid and other current assets	3,776		6,092		6,987		987		17,842
Property and equipment	45,186		40,418		361		11,757		97,722
Goodwill	128,191		202,312		23,567		19,405		373,475
FCC licenses	374,269		295,983		—		47,061		717,313
Network affiliation agreements	123,926		60,765		—		14,420		199,111
Retransmission agreements	68,316		33,107		—		12,198		113,621
Other intangible assets	—		—		52,553		—		52,553
Right-of-use assets for operating leases	22,715		362		—		251		23,328
Other noncurrent assets	237		—		5,253		18		5,508
Total assets acquired	$	801,296	$	667,746	$	97,222	$	111,650	$	1,677,914
Accounts payable	2,037		954		725		1		3,717
Accrued liabilities	8,544		9,011		4,236		1,494		23,285
Deferred income tax liability	—		97,082		(462)		—		96,620
Operating lease liabilities - noncurrent	20,346		226		—		235		20,807
Other noncurrent liabilities	426		—		2,677		—		3,103
Total liabilities assumed	$	31,353	$	107,273	$	7,176	$	1,730	$	147,532
Net assets acquired	$	769,943	$	560,473	$	90,046	$	109,920	$	1,530,382

Less: cash acquired	$	—	$	(2,363)	$	—	$	—	$	(2,363)
Less: fair value of existing ownership	—		—		(12,995)		—		(12,995)
Cash paid for acquisitions	$	769,943	$	558,110	$	77,051	$	109,920	$	1,515,024

We accounted for each of these acquisitions as business combinations, which required us to record the assets acquired and liabilities assumed at fair value. The amount by which the purchase price exceeds the fair value of the net assets acquired was recorded as goodwill.

During 2020, we continued to analyze information related to the estimated fair values for certain tangible and intangible assets acquired, liabilities assumed and the amount of goodwill recognized for these acquisitions. As a result, measurement period adjustments were reflected in the periods in which the adjustments occurred. The most significant changes were to retransmission agreement intangible assets, which were reduced by $21.3 million and goodwill, the carrying amount of which increased by $18.1 million. As a result of these adjustments, we expect our amortization expense related to intangible assets during fiscal year 2020 to be appropriately $68.0 million. During the three months ended September 30, 2020, we finalized the fair value of assets acquired and liabilities assumed for the acquisitions; therefore, the amounts presented above are now final.