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.
A push to expand Louisiana's Medicaid program as allowed under the federal health care has been overwhelmingly rejected by the Senate health committee.
Louisiana welfare recipients would be prohibited in state law from spending the federal assistance at lingerie shops, tattoo parlors, nail salons and jewelry stores, under a bill that received the support Wednesday of a House committee.
Senators will consider whether to prohibit private businesses in Louisiana from paying unequal wages to employees of different genders for the same job.
Rep. Joel Robideaux has delayed bill hearings and said unless a compromise can be reached, he won't bring up the legislation this session.
Once again, Lafayette Parish School Board President Hunter Beasley is focused on an issue that has nothing to do with the educational well-being of our public school children.
After exhausting his appeals all the way to the state Supreme Court, the owner of the Tiger Truck Stop in Grosse Tete has no legal remedy left save one: do an end run around the high court via a bill that would grandfather his “right” to keep a 550-pound tiger enclosed in a pin at his roadside business.
Louisiana poet Darrell Bourque has won the 2014 Louisiana Writer Award, given annually to recognize outstanding contributions to Louisiana's literary and intellectual life.
Drivers would have to secure dogs riding in truck beds while on interstate highways, if the Senate agrees to a bill backed by the House.
Here's your daily look at late-breaking national and international news, upcoming events and the stories that will be talked about Wednesday, April 23, 2014:
Wednesday's Blogs from the Bog!
An effort to prohibit employers from discriminating based on sexual orientation or gender identity was shelved Tuesday for the legislative session.
Louisiana won't lessen its penalties for marijuana possession, keeping laws on the books that allow people to be jailed up to 20 years for repeat offenses of having the drug in hand.
“This is one of the oldest divides that exists, and that divide is about the haves and the have-nots.”
It took a few weeks for the pitfalls to emerge in the governor’s $25 billion budget, but the time of judgment has finally arrived.
With pressure continuing to build for him to resign, Congressman Vance McAllister announced plans recently to remain secluded during the Easter break, but the Swartz Republican has said he’ll be back on the Hill casting votes and attending committee meetings when the congressional recess ends April 28.
A bid to limit the use of unmanned aircraft on private property in Louisiana stalled Monday in the Louisiana Senate.
A Shreveport lawmaker said Monday he's scrapping his proposal to name the Bible as Louisiana's official state book.
Attorney hopes fellow lawyers will join him in urging the D.A. to step aside and allow a competent, ethical challenger to take over the scandal-ridden office.
An official with the Louisiana Department of Education was arrested on a range of charges Friday after allegedly breaking into a home and brandishing a knife.
State Rep. Stuart Bishop says he’s concerned with the quality of Capitol Lake, but when it comes to Louisiana’s coastline, this Lafayette Republican doesn't seem to give a damn.
Democrats sweating this year's elections may be hoping that the Obama administration's latest delay to the proposed Keystone XL pipeline takes a politically fraught issue off the table for the midterms.
Louisiana lawmakers are entering the second half of their three-month regular legislative session, which must end by June 2. Where some of the major issues stand:
Local and state agents Thursday night raided The Keg, the popular college bar located in the area known as The Strip, leading to the (at least) temporary closure of the venue.
Time and time again, the Lafayette Parish School Board shows an overwhelming tendency toward idiocy, but Wednesday night’s contentious discussion over Northside High School’s teen mother program tops the list of dumb discussions.
“The accomplishment of this goal within the next ten years is not only critical for the region to effectively compete with other regions for residents and businesses, but also to provide an amenity for everyone in Acadiana to enjoy.”