Note 2 - Acquisitions |
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Mergers, Acquisitions and Dispositions Disclosures [Text Block] |
On January 13, 2017, we acquired KTVF-TV (NBC), KXDF-TV (CBS), and KFXF-TV (FOX) in the Fairbanks, Alaska television market (DMA 202 ), from Tanana Valley Television Company and Tanana Valley Holdings, LLC for $8.0 million (the “Fairbanks Acquisition”), using cash on hand.As described in Note 1. above, on January 17, 2017, we completed the Media General Acquisition, for an adjusted purchase price of $269.9 million using cash on hand.On May 1, 2017 , we acquired WDTV-TV (CBS) and WVFX-TV (FOX/CW) in the Clarksburg-Weston, West Virginia television market (DMA 169 ) from Withers Broadcasting Company of West Virginia (the “Clarksburg Acquisition”) for a total purchase price of $26.5 million. On June 1, 2016, we began operating the stations, subject to the control of the seller, under a local marketing agreement (“LMA”) that terminated upon completion of the acquisition. On May 1, 2017 , we acquired WABI-TV (CBS/CW) in the Bangor, Maine television market (DMA 156 ) and WCJB-TV (ABC/CW) in the Gainesville, Florida television market (DMA 159 ) from Community Broadcasting Service and Diversified Broadcasting, Inc. (collectively, the “Diversified Acquisition”) for a total purchase price of $85.0 million. On April 1, 2017, we began operating these stations, subject to the control of the seller, under an LMA that terminated upon completion of the acquisition.On August 1, 2017, we acquired WCAX-TV (CBS) in the Burlington, Vermont – Plattsburgh, New York television markets (DMA 97 ) from Mt. Mansfield Television, Inc., for $29.0 million in cash (the “Vermont Acquisition”). On June 1, 2017, we advanced $23.2 million of the purchase price to the seller and began to operate the station under an LMA, subject to the control of the seller. At closing, we paid the remaining $5.8 million of the purchase price through the use of cash on hand and the LMA was terminated.We refer to the eight stations acquired (excluding the stations acquired in the Clarksburg Acquisition) during the first nine months of 2017 and the stations we commenced operating under LMAs during that period as the “2017 Acquisitions.” We refer to the 13 stations acquired in 2016, and that we retained in those acquisitions (including the stations in the Clarksburg Acquisition that we commenced operating under an LMA on June 1, 2016) as the “2016 Acquisitions.”The following table summarizes preliminary fair value estimates of the assets acquired, liabilities assumed and resulting goodwill of the 2017 Acquisitions and the Clarksburg Acquisition (in thousands):
Amounts in the table above are based upon management ’s preliminary estimates of the fair values using valuation techniques including income, cost and market approaches. The fair value estimates are based on, but not limited to, expected future revenue and cash flows, expected future growth rates, and estimated discount rates. Property and equipment are being depreciated over their estimated useful lives ranging from three years to 40 years.O ther intangible assets represent primarily the estimated fair values of retransmission agreements of $29.1 million; advertising client relationships of $5.3 million; and favorable income leases of $3.0 million. These intangible assets are being amortized over their estimated useful lives of approximately 4.9 years for retransmission agreements; approximately 10.7 years for advertising client relationships; and approximately 11.9 years for favorable income leases.Goodwill is calculated as the excess of the consideration transferred over the fair value of the identifiable net assets acquired and liabilities assumed, and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce, as well as future synergies that we expect to generate from each acquisition. We have preliminarily recorded $125.8 million of goodwill related to 2017 Acquisitions. The use of different estimates or assumptions could result in materially different allocations. The goodwill recognized related to these acquisitions is deductible for income tax purposes.Our consolidated results of operations for the three and nine -months ended September 30, 2017 include the results of the 2017 Acquisitions from the date of the respective transaction. Revenue and operating income attributable to the stations acquired in the 2017 Acquisitions and included in our consolidated statements of operations for the nine -months ended September 30, 2017 were $54.2 million and $25.2 million, respectively. In connection with the 2017 Acquisitions, we incurred a total of $1.0 million of transaction related costs during the nine -months ended September 30, 2017, primarily related to legal, consulting and other professional services. Revenue and operating income attributable to the stations acquired in the 2016 Acquisitions and included in our consolidated statements of operations for the nine -months ended September 30, 2016 were $87.9 million and $35.3 million, respectively. |