Byron Allen has hired a New York-area investment bank to help explore the divestiture of his entire local TV station portfolio, the company announced on Monday.
The potential sale is intended to help Allen continue to pay off certain debt associated with his local media transactions over the past few years, and comes after Allen made numerous unsuccessful bids for Paramount Global’s BET Media, the Walt Disney Company’s ABC and TEGNA.
Multicast News was the first to report Allen’s interest in selling his local TV stations, which include outlets in Tucson, Chico-Redding, Eugene and Flint, Michigan. A deal could also involve equity in Local Now, Allen’s free, ad-supported streaming TV service, the outlet reported. (Multicast News and The Desk are both owned by Solano Media LLC.)
Allen has hired Moelis & Company to help explore numerous potential offers and written bids for some or all of his stations.
“Six years ago, Allen Media Group began the process of investing over one billion dollars to acquire big four network-affiliated television stations,” Allen said in a statement. “We have received numerous inquiries and written offers for most of our television stations, and now is the time to explore getting a return on this phenomenal investment.”
It wasn’t immediately clear which companies or individuals had offered to buy Allen’s stations, and whether the submitted bids were for the entire station group, or certain TV outlets. A spokesperson for Allen Media Group said the company did not have further information to offer about the matter. Allen did not return a text message seeking additional comment.
Any deal would allow Allen to make further payments toward reducing his debt load, which was accrued through multi-million dollar purchases of local TV outlets as well as acquiring financial stakes in The Weather Channel — which he now fully controls — and the regional sports outlet Diamond Sports Group.
Some of Allen’s operations have already been impacted by his financial position: Over the past few years, he has quietly wound down certain broadcast operations, including This TV and The Grio, the latter of which was removed from digital broadcast TV in favor of online-only distribution. He also moved to lay off local TV meteorologists at many of his regional outlets in favor of outsourcing local weather forecasts to The Weather Channel, a strategy he ultimately decided not to pursue following backlash from local viewers and advertisers alike.
That said, Allen’s inability to acquire the assets of much-larger media companies presented an opportunity to buckle down and refocus. Over the past few months, he has viewed paying down his financial obligations to creditors more seriously, according to sources. In February, Allen Media repaid its revolving credit facility by issuing new senior notes that will be due in four years.
The move meant Allen Media no longer has a revolving credit facility to tap should it want to acquire more assets, but it also improved the prospect of Allen Media ending each subsequent financial quarter with more cash on hand, S&P Global said in a note earlier this year. As a private company, Allen Media is not required to disclose its financials publicly.
The sale of his local TV stations could give Allen greater runway to avoid having to refinance other existing debt over the next few years.
