News Corp., the media company controlled by Rupert Murdoch, agreed to sell eight of its Fox-network-affiliated television stations in the U.S. — including Denver’s KDVR, Channel 31 — to Oak Hill Capital Partners LP for about $1.1 billion in cash.
The sale leaves Fox with 27 owned-and-operated stations and will probably be completed in the third quarter, New York-based News Corp. said in a statement. Oak Hill will add the stations to nine existing ones, according to its website.
News Corp. is selling the assets to focus on its largest and most lucrative markets following the $5.2 billion takeover of Dow Jones & Co. this year. The purchase will help Oak Hill, a buyout firm founded by Texas oil billionaire Robert Bass, create a broader U.S. network after it paid $575 million to acquire stations from New York Times Co. in May.
“It is part of News Corp.’s strategic decision to shed low-growth, noncore assets,” said Richard Dorfman, managing director of the investment firm Richard Alan Inc., who doesn’t own any shares.
Network-television spending fell 3.8 percent and cable-television revenue fell 0.3 percent in the first half from the year-earlier period, according to Nielsen Monitor-Plus.
For Oak Hill, the purchase is “a classic private-equity play,” said Dorfman. “Ad dollars are migrating to the Web, but it’s a government-licensed franchise that can throw off good cash flow and reliably service debt.”
Oak Hill will get KDVR in Denver and stations in Cleveland; St. Louis; Kansas City, Mo.; Milwaukee; Salt Lake City; Birmingham, Ala.; and Greensboro, N.C., according to the News Corp. statement confirmed by spokeswoman Teri Everett. Everett also confirmed that KDVR would remain a Fox affiliate.
KDVR did not have an official available for comment Monday.
