Belo to split its newspaper and television interests

[jd]

Plans call for the split to take place early next year. The story from Channel 8 in Dallas: www.wfaa.com/sharedcontent/dws/news/localnews/tv/stories/wfaa071001_wz_wfaastory.1292492b2.html

 

[TexasTom]

I wonder if this will allow Belo to exercise its option to purchase KFWD, channel 52? They haven't been able to exercise that option until now because it would have violated the newspaper/TV crossownership rule (WFAA/Dallas Morning News was grandfathered in, but the grandfather clause wouldn't have covered the purchase of KFWD).

 

[jd]

I wonder if this will allow Belo to exercise its option to purchase KFWD, channel 52? They haven't been able to exercise that option until now because it would have violated the newspaper/TV crossownership rule (WFAA/Dallas Morning News was grandfathered in, but the grandfather clause wouldn't have covered the purchase of KFWD).

Yes. Even if that wasn't the underlying motive for the maneuver, I'd expect that to be one of the first items on the agenda.

 

[captex]

how about the station in fredericksburg,tx kcwx ch.2, which is lma with kens 5 in san antonio?

 

[Mediafrog+]

I wonder if this will allow Belo to exercise its option to purchase KFWD, channel 52? They haven't been able to exercise that option until now because it would have violated the newspaper/TV crossownership rule

I imagine they're thinking about that, but the problem is the two companies are still too close together, with a lot of common management and controlling shareholders. I think the FCC would bounce the idea until the two can demonstrate complete independence from each other, which may take several years.

 

[dhett]

I wonder if this will allow Belo to exercise its option to purchase KFWD, channel 52? They haven't been able to exercise that option until now because it would have violated the newspaper/TV crossownership rule

I imagine they're thinking about that, but the problem is the two companies are still too close together, with a lot of common management and controlling shareholders. I think the FCC would bounce the idea until the two can demonstrate complete independence from each other, which may take several years.

I was wondering about that. It seemed like a distinction without a difference to me.

 

[Kent]

I don't see this split as being something that would allow Belo to double up where it owns newspapers. The FCC still wouldn't likely allow it. Something like this often happens because they're preparing to sell at least one of the parts they're splitting and/or planning to take part of the business private.

 

[TexasTom]

After posting my original comments, I saw something to the extent that this split won't be considered a major ownership change by the FCC -- ie, Belo can file a "short form" ownership change form instead of the more detailed form required for a major ownership change.

Based on that, I'd agree with those here who have posted that Belo will most likely still be unable to exercise their option to purchase KFWD.

 

[arnoldevns]

This move is about one thing: stock prices. Belo believes (and probably rightly so) that it can get more stock value by splitting up.
Both companies will be based in the same building with the same people in place. They'll just be able to value their TV and newspaper assets separately. The newspapers have been dragging the stock down for years. They're fairly certain the TV stock will soar once the split happens.