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.
At the horn the officiating crew trotted to the tunnel and left security personnel to clean up after them.
Friday's Blogs from the Bog!
Sign "ninjas" cleaning up clutter; NYC doctor positive for Ebola; Ferguson grand jury decision nears; and more national and international news for Friday, October 24, 2014.
We can safely assume incumbent Chief K.P. Gibson isn’t too worried about this challenger.
Nationally, Republicans must gain six seats to win Senate control. The most competitive races, many in states where Obama lost in 2012, remain too close to call.
The Baton Rouge Republican has repeatedly battled a perception within his own party that he perhaps wasn't the best choice to carry the GOP banner.
Even if Jimmy Graham's production dips while the star tight end recovers from a shoulder injury, it looks like Drew Brees won't have much trouble finding other targets.
A former campaign manager for Senate candidate Rob Maness is striking at the Republican contender's tea party support, saying Maness only sought to appeal to conservative organizations because he needed money for his campaign.
Ninety-two percent of public school teachers were rated either effective or highly effective in a report the state issued marking the second year of a new statewide evaluation process.
School board members Mark Babineaux, Hunter Beasley and Tehmi Chassion can vote to fire Cooper — because we all know that’s exactly what they’ll do.
District 2 school board candidate Simon Mahan is hoping to unseat first-term incumbent and former Carencro Mayor Tommy Angelle in the Nov. 4 election.
District Attorney Mike Harson is showing his desperation by falsely attributing quotes to his opponent and blocking journalists from his social media.
The governor is traveling the country laying the groundwork for a possible 2016 presidential campaign, but his approval ratings at home hover well below 50 percent.
State District Judge Bob Downing extended the order and delayed a planned Wednesday hearing about a permanent injunction while negotiations continue between Attorney General Buddy Caldwell and the waste disposal site operator.
New Louisiana higher education commissioner Joseph Rallo will be paid more than his predecessor.
Elijah McGuire and Alonzo Harris each had four rushing touchdowns, and Louisiana-Lafayette rolled to 419 yards on the ground in a 55-40 victory over Arkansas State on Tuesday night.
Bill and Hillary Clinton are the validators-in-chief for Democrats struggling through a bleak campaign season in states where President Barack Obama is deeply unpopular.
President Barack Obama is turning to black radio listeners to plead for midterm votes, a targeted approach to drum up Democratic support at a time when many candidates don't want him around in person.
"I am extremely disheartened by the political machines that are attempting to hijack my efforts along with others that advocate for children."
Landrieu, who is fighting to keep her seat for a fourth term, said that Ebola is serious and precautions should be taken, but she accused Republicans of using the virus outbreak in West Africa to "create fear" here at home.
Law enforcement agencies are participating in a "Louisiana Heroin Summit," designed to address the recent rise in heroin use and drug-related deaths around the state.
State education officials are preparing to release performance scores for public schools and public school districts.
Saints coach Sean Payton is starting a new week by emphasizing, repeatedly, the many good things he noticed during New Orleans' latest loss.
We will be offering our recommendations on the constitutional amendments tomorrow.
The justices did not comment in leaving in place lower court rulings that dismissed the lawsuits against BP and other companies involved in the worst U.S. offshore oil spill.