Peter Martin in the WCAX news control room. VBM file photo.
Vermont Business Magazine Gray Television, Inc (NYSE: GTN and GTN.A), an Atlanta-based media conglomerate, announced today that it has reached an agreement with Mt Mansfield Television, Inc to acquire WCAX-TV, the CBS affiliated television station in South Burlington for $29 million. The Martin family launched the TV station in 1954. The Burlington, Vermont-Plattsburgh, New York, market is the 97th largest in the nation. WCAX has 95 employees.
In a WCAX news story earlier today, WCAX reported that there would be no layoffs and that Gray would take over on June 1.
"Gray is thrilled that the Martin family selected us as the new steward of Vermont's very first television station," said Kevin Latek, Gray's Executive Vice President. "We will proudly build upon WCAX's strong foundation and six decades of success as we expand into Vermont, northern New York and northern New Hampshire with another great leading local media institution."
Peter Martin, the President of Mt Mansfield, said, "WCAX is an integral part of the dynamic communities in which our family has lived, worked, and grown for decades. We welcome Gray to Vermont with the knowledge that its values, resources, and portfolio of similar stations will ensure that WCAX continues providing strong journalism, community leadership, and workplace excellence for many more decades to come."
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The WCAX evening news team: Mike McCune, Kristin Kelly, Darren Perron and Sharon Meyer
Gray also reported on Thursday first-quarter net income of $10.5 million for a profit of 14 cents a share on $203.5 million in revenues. Shares were down nearly 2 percent for the day.
Gray said in a press release that the transaction advances Gray's transformative growth strategy as we continue to expand through select acquisitions of market-leading stations that share the culture and values of our existing television stations. Moreover, through this acquisition, Gray will enter another strong market that includes both the state capital of Montpelier as well as numerous colleges and universities such as the University of Vermont, SUNY-Plattsburg, and Dartmouth.
Including expected synergies, the transaction represents what Gray calls an attractive purchase price multiple of less than 6.0 times expected blended 2016-2017 pro forma broadcast cash flow. Gray anticipates that the transaction will be leverage neutral, immediately free cash flow accretive, and funded primarily through the use of cash on hand at closing and, if necessary, borrowings under our existing senior credit facility. Subject to receipt of regulatory and other approvals, Gray expects to close the transaction in the third quarter of 2017.
Gray owns and/or operates over 100 television stations across 56 television markets that collectively broadcast more than 200 program streams including 103 channels affiliated with the CBS Network, the NBC Network, the ABC Network and the FOX Network. Our portfolio, including pending acquisitions, includes the number-one and/or number-two ranked television station operations in essentially all of our markets, which collectively cover approximately 10.6 percent of total United States television households.
SOURCE ATLANTA, May 4, 2017 /PRNewswire/ -- Gray Television, Inc.