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Gray Buying Schurz For $442.5 Million

The deal will expand Gray's operations to a total of 49 television markets and 28 states. "In a rapidly consolidating industry where size and scale matter more than ever before, we have come to the realization that Gray Television would be the best steward to ensure our stations succeed over the long-term," explained Todd Schurz, president-CEO of Schurz.
http://www.tvnewscheck.com/article/88437/gray-buying-schurz-for-4425-million

Two things of interest:

In the Augusta, Georgia, market (DMA 112), Schurz owns WAGT-TV, the market's NBC and CW affiliate. Gray owns WRDW-TV, the market's CBS affiliate. Over time, Gray expects to consolidate WAGT-TV's operations with Gray's existing operations in this market. Gray anticipates that the FCC license for WAGT-TV will be offered in the upcoming FCC spectrum auction, with the proceeds from such auction, if any, payable to Gray.

Since Gray has already bought WBEK-CD, it would be wise to move The CW stream there. Here's how I'd see things in Augusta:
WRDW: 12.1 CBS (1080i HD), 12.2 NBC (720p HD), 12.3 MNT/Antenna TV (480i SD)
WBEK-CD: 16.1 CW (1080i HD)
WAGT: 26.1 ????

In the Rapid City, South Dakota, market (171), Schurz owns KOTA-TV and three satellite stations, which serve as the market's ABC affiliate. KOTA-TV is the number one ranked and highest grossing station in the market. Gray anticipates combining KOTA-TV's operations with those of Gray's KEVN-TV, the market's FOX affiliate.

Here's one that could go either way. If KEVN goes:
KOTA/KHSD/KDUH/KSGW: 3.1/11.1/4.1/12.1 ABC (720p HD), 3.2/11.2/4.2/12.2 FOX (720p HD), 3.3/11.3/4.3/12.3 MeTV (480i SD)
KEVN/KIVV: 7.1/5.1 ????

If KOTA goes:
KEVN/KIVV: 7.1/5.1 FOX (720p HD), 7.2/5.2 ABC (720p HD), 7.3/5.3 MeTV (480i SD)
KOTA/KHSD/KDUH/KSGW: 3.1/11.1/4.1/12.1 ????

In either case, ThisTV would move to the LPTV that Gray's buying in Rapid City (can't remember call sign).
 
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I got the impression Gray would be keeping KOTA, though I can't find any mention of that in the press release.

In Augusta, they will be folding WAGT into the existing operation and auctioning its spectrum.

Schurz also has an SSA with KSPR 33 in Springfield, MO. I wouldn't be surprised if something similar happens there. They could easily move KYTV to KSPR's DT-19 and auction KYTV's DT-44, which should be more valuable in the spectrum auction. They could either piggyback KSPR onto one of the subchannels on DT-19 or start broadcasting it on LP K15CZ.
 
If Gray is smart, they'll keep KEVN and KHSD, ridding themselves of the low-VHF signals of KOTA and KIVV. (Perhaps they would try to sell KIVV to one of the other stations in the area, or donate to South Dakota Public Broadcasting.)

My big question is what happens in Scottsbluff? Will they be able to own both KDUH and KSTF?

- Trip
 
Gray Television Sells Some, Buys Some

In Wichita, Kan. (DMA 65), Schurz owns CBS affiliate KWCH and Gray owns ABC affiliate KAKE. Gray previously announced its intention to acquire KWCH and sell KAKE.

Gray has now reached an agreement with Lockwood Broadcast Group to sell it KAKE in exchange for Lockwood's WBXX and $11.2 million in cash. WBXX is the CW affiliate in Knoxville, Tenn. (DMA 62), where Gray owns CBS affiliate WVLT. This swap will give Gray a second station in its largest market, and the cash component will slightly lower the effective purchase price for the Schurz acquisition, Gray said.

In South Bend, Ind. (DMA 96), Schurz owns CBS affiliate WSBT and Gray owns NBC affiliate WNDU. Gray previously announced its intention to retain WNDU and divest WSBT. Gray has now reached agreements with Sinclair Broadcast Group to swap WSBT in exchange for Sinclair's WLUC Marquette, Mich. (DMA 180), whose channels serve as the NBC and Fox affiliates for the market.

In Rapid City, S.D. (DMA 171), Schurz owns ABC affiliate KOTA and Gray owns Fox affiliate KEVN. Gray will sell Legacy Broadcasting all of KOTA's assets, including FCC licenses, real estate, programming agreements and retransmission consent agreements, but will keep the ABC affiliation, which it will move to KEVN at closing. The sales price for this transaction is $1. Gray and Legacy will not have any shared services agreement, so Legacy will own and operate KOTA-TV's MeTV and ThisTV channels independently from Gray following closing.

In addition, in Anchorage, Alaska (DMA 148), Gray previously announced that it will buy from Schurz the market's NBC affiliate, KTUU. Recently, Gray reached an agreement with Fireweed Communications to acquire KYES, the market's MNT affiliate, for $500,000. Gray will apply to the FCC for a "failing station" waiver of the local ownership rules to permit the combination of KTUU and KYES, which Gray says “we believe will permit us to improve the programming and services offered by both stations.”

http://www.tvnewscheck.com/article/88873/gray-television-sells-some-buys-some
 
Schurz also has an SSA with KSPR 33 in Springfield, MO. I wouldn't be surprised if something similar happens there. They could easily move KYTV to KSPR's DT-19 and auction KYTV's DT-44, which should be more valuable in the spectrum auction. They could either piggyback KSPR onto one of the subchannels on DT-19 or start broadcasting it on LP K15CZ.

It's happening, but the other way around. It's KSPR's spectrum that being auctioned. ABC is likely moving to KYTV 3.2. But where would The CW go?
https://licensing.fcc.gov/cgi-bin/w...xt=25&appn=101713300&formid=314&fac_num=35630
 
The Gray/Schurz deal has been approved by the FCC, with some conditions.
https://transition.fcc.gov/Daily_Releases/Daily_Business/2016/db0212/DA-16-154A1.pdf

In Wichita-Hutchinson, Kan., the FCC granted Gray's request for a "failing station waiver" in the case of KSCW. However, it did not grant Gray's request for a waiver of the JSA between KWCH and Entravision-owned KDCU in Wichita. "Although the Commission has recognized that "cooperation among stations may have public interest benefits under some circumstances, particularly in small to mid-sized markets," such as Wichita-Hutchinson, it nonetheless concluded that "these potential benefits do not affect our assessment of whether television JSAs confer significant influence such that they should be attributed." The FCC gave Gray "one year to terminate the KDCU-DT JSA or otherwise bring it into compliance with the commission’s rules."

In Augusta, Ga., the FCC granted Gray's request to continue operation of WRDW and WAGT until after the incentive auction. "We find that the benefits of facilitating the larger transaction and encouraging participation in the broadcast incentive auction outweigh any potential harm that may result from the grant of a temporary waiver of the Duopoly Rule."

The FCC said it would not permit Gray to take WAGT off the air upon closing the Schurz transaction. "Rather, we require Gray to operate the station separately during the period of common ownership, maintaining its programming and refraining from engaging in any joint sales, including joint sales with WRDW."

"Indeed, our action with respect to the assignment of the license of WAGT is specifically conditioned upon termination of the existing JSA with Media General [WJBF]. Finally, following its acquisition of WAGT, we direct Gray to prepare and file an application to assign the station's license to an independent divestiture trust, which we will process and grant, in the event that the license is not surrendered in the auction."

In Cheyenne-Scottsbluff, Wyo.: "We believe that a temporary waiver of the Duopoly Rule to permit common ownership of KDUH and KGWN until the conclusion of the community of license change proceeding for KDUH-TV is warranted," the FCC wrote. "During the limited duration of the waiver, the station's programming will focus on a DMA other than the one in which the violation occurs, and the significant interest in providing viewers in western Nebraska access to television broadcast signals that originate in their State of residence — one expressly recognized by Congress far outweighs any potential harm that may be caused from joint ownership."

In Springfield, Mo., Schurz owns KYTV and is party to various sharing agreements with Perkin Media, the licensee of KSPR Springfield, including a JSA/SSA and an option to acquire the station. Schurz also guarantees Perkin's financing arrangements. According to the FCC, "Gray has stated that, while it will assume the non-attributable SSA upon closing the Schurz transaction, it will not assume the JSA (which will terminate), the option or the guarantee of Perkin's indebtedness, nor will Gray, on its own, guarantee it. Furthermore, Schurz has exercised its option to acquire KSPR from Perkin, and its application for consent to assignment of the station’s license is off Public Notice and unopposed." The commission said that "the parties have committed to steps that would result in their compliance with the commission’s multiple ownership rules."

In Rapid City, S.D.: Gray has assigned to Legacy Broadcasting its rights to acquire KHME (formerly KOTA), Rapid City, and its full-power satellite station KHSD Lead, S.D., from Schurz.

"Legacy has provided information sufficient to warrant continued satellite operation for KHSD…. Given the station’s long history as a satellite, the geographically challenging nature of the market, lack of access to compelling programming, and insufficient advertising revenues to support ongoing operational costs, it is unlikely that an alternative operator would be willing and able to operate the station as a stand-alone facility. Accordingly, we find that the continued operation of KHSD as a satellite of KHME would serve the public interest."

http://www.tvnewscheck.com/article/92298/fcc-oks-grayschurz-deal-with-strings
 
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