Cox Sells Majority Stake in TV Stations

• Cox Enterprises reached a deal with Apollo Management Group, an international investment firm, to sell a majority stake in Cox Media Group.
• Cox Media Group owns 14 television stations, including WSB-TV in Atlanta, Georgia.
• The acquisition follows a nationwide consolidation trend for television stations and comes as regulators at the Federal Communications Commission debate loosening the restrictions on merging broadcasting groups.

Cox Enterprises yesterday made a deal to sell a majority stake in a subsidiary, Cox Media Group, to Apollo Management Group. The move is the first step in a play by Apollo to become a major presence in the broadcasting industry.

Based in Atlanta, Georgia, Cox Media Group owns 14 television stations and has a reach of 31 million viewers, including viewers of WSB-TV, ABC in Atlanta, Georgia.  Bloomberg news reports the Cox Media Stations are worth approximately $3 billion.

Apollo is an investment firm that has plans to expand into the broadcasting sector. While a majority stake in Cox Media Group is among Apollo’s first media purchases, Apollo next intends to acquire additional broadcasting groups, including Nextar Media Group. If Apollo is also successful in the firm’s deal with Nextar, Apollo will reach almost a quarter of U.S. households with its TV stations.

Both deals would be subject to approval from regulators. However, regulators like the Federal Communications Commission are unlikely to block the purchases. In fact, the FCC has been considering loosening restrictions on how many television stations one company can own. The current FCC rules restrict any single broadcaster from owning stations that reach more than 39 percent of the nation’s households.

The issue of media consolidation in the television industry was made famous last year after a viral video surfaced of Sinclair owned television stations repeating the same script about biased and false news. Sinclair is one of the largest broadcasting groups in the country. Broadcasting groups have been under pressure to consolidate partly because of the rising competition of online media outlets.

The specific terms of the deal, including how much control Cox Enterprises will retain as a minority stakeholder, have yet to be announced. However, in the official press release, Cox Enterprises stated Apollo planned to keep the “management and operating structure Cox Media Group’s TV business has created.” Headquartered in Atlanta, Georgia, Cox Enterprises is a global company with over $20 billion in annual revenues. The full press release can be located here.