JPMorgan and Deutsche Bank last Tuesday launched syndication of a $500 million deal for LIN TV Corp. The loans consist of a $250 million delayed-draw term loan and a $250 million revolver. Pricing is LIBOR plus 1 1/4% on both tranches. The deal also includes $175 million in subordinated notes due 2013, which were priced in September. The debt will be used to refinance existing credit facilities and fund the $260 million acquisition of five TV stations from Emmis Communications Corp.
Standard & Poor's assigned a BB- rating to the loans and a B- rating to the notes. S&P said the proposed transaction will increase LIN's total debt to EBITDA ratio to the mid-six times area. Moody's Investors Service assigned a B1 rating to the notes.
LIN is acquiring KRQE, the CBS affiliate serving Albuquerque, N.M.; WALA, the FOX affiliate serving Mobile/Pensacola Fla.; WBPG, the WB affiliate serving Mobile/Pensacola, Fla.; WLUK, the FOX affiliate serving Green Bay, Wis.; and WTHI, the CBS affiliate serving Terre Haute, Ind. In a release, the company explains that by operating multiple stations in various markets and hubbing single stations out of its technology centers, LIN can increase market share while also controlling costs.
At the time of the acquisition announcement in August, Providence, R.I.-based LIN also announced it planned to do a share repurchase program of up to $200 million of the company's class A common stock. Prior to the close of the acquisition, LIN TV Corp. owned and operated 25 television stations in 14 mid-sized markets in the U.S. and Puerto Rico. It also has partial ownership in five other stations. Based in Indianapolis, Emmis owns 23 FM radio stations, two AM radio stations, as well other television stations, and has a magazines and book publishing division. It is in the process of selling another station, WSAZ-TV in Charleston-Huntington, W. Va to Gray Television for $186 million. S&P just assigned a BB- rating to a proposed $600 million senior secured credit facility, which will be used to help fund the acquisition and refinance existing debt.
Vincent Sadusky, LIN's v.p., cfo and treasurer, could not be reached.