Could Nexstar Purchase Disney’s ABC Stations?
Bob Iger shocked both Disney fans and Wall Street observers last June when he publically announced that Disney’s linear television stations “may not be core” to the company’s future.
Since that time, the million-dollar question lingering over Disney has been whether or not the company will divest itself of its linear stations altogether.
If Disney should choose to sell their assets, former Nexstar executive Tom Carter believes that the private equity firm could be a potential buyer.
Why Nexstar Would Buy
Carter, who is now a senior advisor to Nexstar’s CEO and board of directors stated that the private equity firm could purchase Disney’s local ABC stations with “little friction” should they become available.
“We think there could be some opportunities depending on how things fall out,” Carter said of a possible ABC sale.
In his first ten years with Nexstar, Carter estimates that the firm made 40 acquisitions. Based on the success that the company had with those purchases and the “massive” cash flow that resulted from past deals, Carter believes that Nexstar will “take a look at [ABC].”
“You’re seeing ESPN simulcast a large portion of their sports telecasts on ABC. If you were to buy the ABC complex, how would that work going forward? There are a lot of questions that need to be answered,” he said.
Would The FCC Allow The Sale?
One possible roadblock to a Nexstar acquisition could be the fact that the company already owns the CW. When asked about a possible FCC blockage of a sale, however, Carter was unconcerned.
“ABC’s portfolio of stations is modest. It’s only eight, largely in the top 10 markets. We’re in eight of the top 10 markets already with a CW station. We could buy a second station in that market and not increase our household footprint. There may be a few stations that would require divestiture of either a Nexstar station or an ABC station, but we could onboard those with relatively little friction.”
Whether or not a sale is to Nexstar, what Disney chooses to do with ABC will have a massive impact on the future of the company.
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