Sinclair Broadcast details debt commitments for Tribune purchase

By Sara Rosenberg

New York, May 9 – Sinclair Broadcast Group Inc. revealed in an 8-K filed with the Securities and Exchange Commission on Tuesday that the debt financing commitments for its acquisition of Tribune Media Co. are split between an up to $4,847,000,000 seven-year senior secured incremental term loan B, an up to $225 million incremental revolving credit facility and an up to $785 million one-year senior unsecured bridge loan.

When the acquisition was announced on Monday, company officials said in a call that although the commitment is for a large term loan and a smaller bridge loan, when permanent financing is sought after, the plan is to keep it more at a 50/50 mix between fixed- and floating-rate debt.

JPMorgan Chase Bank, RBC and Deutsche Bank Securities Inc. are the leads on the financing.

The borrower of the debt is Sinclair Television Group Inc., a wholly owned subsidiary of Sinclair Broadcast Group.

The commitment letters also contemplate some amendments to the company’s existing credit agreement to permit the acquisition and to provide for the incremental term loan B.

Other funds for the acquisition will come from cash on hand.

Under the agreement, Sinclair is buying Tribune for $43.50 per share, for an aggregate purchase price of about $3.9 billion, plus the assumption of around $2.7 billion in net debt. Tribune stockholders will receive $35.00 in cash and 0.23 of a share of Sinclair class A common stock for each share of Tribune class A common stock and class B common stock they own.

Closing is expected in the fourth quarter subject to approval by Tribune’s stockholders and customary conditions, including approval by the Federal Communications Commission and antitrust clearance.

In order to comply with FCC ownership requirements and antitrust regulations, Sinclair may sell certain stations in markets where it owns stations. The potential divestitures will be determined through the regulatory approval process.

Including the Tribune acquisition (before any related divestitures), all previously announced pending transactions, and pro forma for expected synergies, Sinclair’s 2015 media revenues would have been $4.07 billion and 2016 media revenues would have been $4,603,000,000.

Leverage is less than 5 times on a blended 2016/2017 EBITDA basis at Dec. 31, 2017, including synergies.

Sinclair is a Hunt Valley, Md.-based television broadcasting company. Tribune is a Chicago-based owner of television and digital properties.

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