Tribune Company said jointly that it will acquire 19 television stations from Local TV Holdings for $2.73 billion in cash, making it the largest TV broadcaster in the United States.
The purchase from New York private equity firm Oak Hill Capital Partners is another step for Tribune, the publisher of the Los Angeles Times and the Chicago Tribune, in transforming itself largely to a broadcast company as it seeks to sell off its newspaper division.
Tribune, which currently has 23 television stations and eight newspapers, emerged from bankruptcy protection in December.
With Local TV, Tribune will now have stations in large markets like New York, Los Angeles, Miami, Cleveland, Denver and Seattle and will reach the most households in the United States. Its shares were up 6.6% at $60.65 on the pink sheets in afternoon trading.
Tribune owns WPIX-TV (CW) in New York.
Besides advertising revenue, TV stations get retransmission fees from cable companies looking to broadcast their programs on local TV.
“This is a transformational acquisition for Tribune – it makes us the No. 1 local TV affiliate group in America, expands the distribution platform for our high-quality video content, and extends the reach of our digital products to new audiences across the country,” Tribune’s President and CEO Peter Liguori said.
Tribune is the latest company to snap up local TV stations as the industry consolidates. Last month, Gannett, the largest U.S. newspaper chain, announced a deal to buy Belo Corp. and its 20 local TV stations for $1.5 billion.