Rumors of a potential sale have popped up occasionally over the years. But speculation began heating up this past summer that Lafayette's Galloway family ' father Tom and son Sheldon own both Baton Rouge TV stations ' were interested in cashing out.
Only one Galloway appears to have ownership in Lafayette. In January, Tom's Communication Corp. of America bought Fox affiliate KADN and low-power KLAF, a UPN station, after operating them for years via what's referred to in the industry as a "local marketing agreement." Tom, whose primary residence is in Florida, bought them from businessman Charles Chatelain for $16.65 million.
Last month a Galloway spokesman confirmed to Baton Rouge's online Daily Report that the companies are indeed marketing a combined 23 signals ' some owned by Tom's company and the others by son Sheldon's White Knight Broadcasting. Still, the questions are piling up. Why are they selling? Why now? And who are the potential buyers?
Answers are in short supply, as Tom Galloway and his son are notoriously tight-lipped. Neither Sheldon nor Wayne Elmore, CEO of Tom Galloway's Communications Corp., returned calls seeking comment for this story. Phil Waterman, general manager of Baton Rouge's WVLA, said local executives won't comment either.
But it was Elmore who initially confirmed the Galloways were interested in a sale. In mid-October he told Daily Report that the Los Angeles office of UBS, the giant, multi-national investment house, had been hired to market the family's group. At the time, Elmore said UBS had fielded 58 inquiries. Most of the Galloways' stations are in Louisiana, Texas and Mississippi; Elmore also told The Advocate that they were being marketed as a portfolio and won't be sold individually.
The Galloway companies are privately held, and any information about a potential sale is being kept very close to the vest. Mark Fratrik, a media analyst and vice president with Virginia-based communications consulting firm BIA Financial Network, says the amount of the Galloway group's sale would depend on any number of factors, but TV stations typically are valued at about 10 to 12 times cash flow. The financial condition of the Galloways' Baton Rouge and Lafayette stations is unclear. Company reps aren't talking, and Fratrik declined comment on that subject.
According to BIA's estimates, the Galloways' WVLA billed about $8.4 million last year, while WGMB Fox billed about $5.9 million, well below the Baton Rouge market's top billers, ABC affiliate WBRZ and CBS affiliate WAFB. In Lafayette, KADN's 2004 revenues were in the ballpark of $4.2 million (and KLAF's about $900,000), compared with ABC affiliate KATC's estimated $9 million, and CBS affiliate KLFY's $15.8 million, according to BIA.
The stations' ownership structure could affect a potential sale.
In an effort to guard against media oligarchies, FCC rules generally limit owners to two stations per market, provided total viewership remains below a certain percentage of market totals. Though the Galloways have passed FCC muster, they've managed to skirt those rules in Baton Rouge through a peculiar arrangement. While the elder Galloway's Communications Corp. is the owner of WGMB Fox and WBRL, a low-power affiliate of The WB network, Sheldon's White Knight Broadcasting holds NBC station WVLA and KZUP, a low-power independent.
Each maintains separate sales and operations staff, but all operate in the same building on Perkins Road near Bluebonnet Boulevard.
Fratrik was hesitant to discuss how that arrangement might impact the stations' sale, acknowledging that his firm has done consulting work in the past for the Galloway group. But in general terms, he said, it would not necessarily prevent the stations from being purchased by a single owner. The low-powered signals would not likely affect a sale, and Fratrik said the FCC has been known to waive its ownership rules if stations can demonstrate financial distress.
Like most of the Galloways' properties, both Fox stations and the family's NBC affiliate lack a conventional news department, by far the biggest revenue source for local stations. WVLA dropped local news in the '80s after years of last-place ratings. And despite efforts in the late '90s to comply with a now-abandoned network dictum that affiliates air a 9 p.m. newscast, neither Fox station is offering a local news product.
Launching a news department from scratch is expensive, and there already is intense competition in Baton Rouge and Lafayette ' where KATC and KLFY battle it out for market share and ratings. But other analysts and observers have long speculated that there is room for another local-news player in both markets. Offering local news on at least one of the Galloway stations in Baton Rouge and the Fox affiliate in Lafayette could be worth the gamble, especially after Hurricane Katrina radically altered the Lafayette, Baton Rouge and New Orleans populations.
In its initial story on the Galloways' pending sale, Daily Report cited that one potential buyer could be Raycom Media, the Montgomery, Ala.-based owner of 37 stations in 20 states, including WAFB, the long-time leader in Baton Rouge's news ratings and one of the company's top money-makers.
Not unexpectedly, Raycom has been mum; the company did not return calls seeking comment. Raycom might be the best fit because of its familiarity of the Baton Rouge market and its regional focus. Earlier this month, it announced a planned $600 million sale of 12 stations to concentrate on its core properties in the Southeast and Midwest.
Some sources indicated, however, that a Raycom deal could be tricky, given the FCC ownership rules and the likelihood that any potential buyer is unlikely to be interested in the Galloways' entire group. Raycom's interest, therefore, might hinge on its ability to line up other buyers to flip some of the Galloways' less desirable stations.
A potential Raycom purchase makes it unlikely the group would launch another news product in Baton Rouge, essentially competing against itself, but that would not be the case in Lafayette.
The Board of Elementary and Secondary Education has stalled action on a $3.5 billion annual school funding formula due to state lawmakers by March 15.
The New Orleans Saints have yet to make it official as of this writing, but popular wide receiver Lance Moore has reportedly been cut by the team to free up salary-cap space on the roster.
While two medical marijuana bills are slated for the upcoming legislative session, what some Louisianans might not know is that the plant was approved for therapeutic use by state lawmakers in 1991.
The agenda is shaping up to be lighter than in previous years. But Jindal is term-limited, with fewer than two years remaining in office, and he saw his last big initiative — a proposed rewrite of Louisiana tax law — collapse without getting a vote in 2013.
Sharper has been held without bail because of an arrest warrant issued by Louisiana authorities accusing him and another man of raping two women.
Here's your daily look at late-breaking national and international news, upcoming events and the stories that will be talked about Friday, March 07, 2014:
Two Lafayette men have been revealed by police as the infamous duo behind a caper that shook our fair city to its core.
The Lafayette Parish School Board has received a second letter of demand related to last year’s insurance debacle, this time from Key Benefit Administrators claiming it’s owed $93,000 from the school system.
The Louisiana coastline is vanishing faster than mappers can keep track.
A bill that would have overridden local ordinances prohibiting public and private employers from discriminating against lesbian, gay and transgender people has been pulled within less than a week of being filed.
The panel that selects nominees for a controversial New Orleans area flood control board — a board that is suing more than 90 oil, gas and pipeline companies — is set to discuss legislation affecting its independence.
State prison officials cannot keep secret the seller and manufacturer of the two drugs purchased for executions at the Louisiana State Penitentiary, a federal judge ruled Wednesday.
State lawmakers will not appeal a judge's ruling that it was improper to use $3.7 million from a probation and parole officers' retirement fund to balance the state's operating budget.
Conservatives have been losing their minds over this satirical bit on the Colbert Report.
The Lafayette Parish School Board leaves a lot to be desired, but is scrapping the election process in favor of an appointed board the answer?
The House approved legislation Tuesday night to roll back a recently enacted overhaul of the federal flood insurance program, after homeowners in flood-prone areas complained about sharp premium increases.
The NFL has formally designated New Orleans' Jimmy Graham as a tight end for the purposes of his franchise tag value, which is now set at $7.05 million next season unless Graham and the Saints subsequently agree on a long-term deal.
A federal appeals panel ruled Monday that businesses don't have to prove that they were directly harmed by BP's 2010 Gulf Of Mexico oil spill to collect settlement payments.
The Louisiana Department of Transportation and Development has closed Interstate 10 from I-49 in Lafayette to Seigen Lane in Baton Rouge.
Jim Bernhard, who engineered the sale of The Shaw Group for $3 billion, recently has told several people involved in Democratic politics that he intends to run for governor in 2015.
A New Orleans levee board wants to hold the oil and gas industry accountable for decades of damage to our state’s coastline, but the Legislature may be poised to put the kibosh on the suit.
New standards curb elective induction
CVS stops tobacco sales
If an Acadia Parish fiddler misses a note while swatting a fly, will a St. Martinville accordionist learn “Ma ‘Tite Fille”?
(It's good, it's bad and it's just crazy)