Scripps Goes National With ION Media Buy

The $2.65 billion deal will “transform” Scripps, roughly doubling its TV station footprint and supercharging distribution of its programming.
Matthew HellerSeptember 24, 2020

Local TV station giant E.W. Scripps is buying independent broadcaster ION Media in a $2.65 billion deal that will give it a national footprint — with an assist from Warren Buffett.

ION distributes syndicated shows such as “Law and Order” and “NCIS: Los Angeles” through an “over-the-air” national network of licensed television stations it owns in 62 markets and 124 affiliated stations, reaching 96% of U.S. homes.

The acquisition announced Thursday will merge ION with Scripps’ five Katz networks and its Newsy multiplatform news service to create a new national TV business for the nation’s fourth-largest independent TV station owner, which has 60 stations in 42 markets.

Buffett’s Berkshire Hathaway will help finance the deal by making a $600 million preferred equity investment in Scripps.

“This evolution of Scripps’ national television networks business … repositions the company in the television landscape,” Scripps CEO Adam Symson said in a news release. “With its strong revenue growth, high margins and significant cash flow, ION will make Scripps a more powerful and durable media business with significant near-term benefit as well as long-term value. “

The Wall Street Journal said the deal will “transform” Scripps, roughly doubling its TV station footprint and supercharging distribution of its programming.

Over-the-air networks “are seen as increasingly attractive as more consumers cut the cord and instead rely on streaming services like Netflix and free-to-air programming,” the Journal noted.

West Palm Beach, Fla-based ION started out to Pax TV in the 1990s, rebranding to ION in 2007. According to Scripps, its average prime-time audience is the fifth largest among all networks carried by cable operators and it posted a compound annual growth rate of about 12% between 2009 and 2019, with revenue last year of $587 million.

“ION Media is a distribution double threat — carried on cable and satellite through must carry while also capitalizing on cord-cutting and the growth of free over-the-air broadcasting,” Symson said.

The WSJ noted that the deal “is a somewhat unexpected move for Berkshire, which hasn’t recently made media investments” and in January sold its newspaper business to Lee Enterprises for $140 million.

(Photo by Ben Gabbe/Getty Images)