Wall Street loves broadcasting, and bigger broadcast companies do better than smaller ones these days. Bigger companies have more leverage to negotiate retransmission deals with cable companies. Once this deal is approved, Scripps will be the powerhouse owner of ABC stations, which gives the company leverage to influence the network. Scripps stock hit five-year highs Thursday in response to the news that the company was spinning off its newspapers from the broadcast and online properties.
Wednesday’s deal is part of a mosaic of mega-media mergers that have produced super-sized broadcast owners that are more than twice the size of what they were only a decade ago. These giant companies include Sinclair, Nexstar, Media General, Gannett, Gray and others all of whom have grown considerably even while newspapers retreat. Read more