Cincinnati’s EW Scripps buys ION Media, the national network originally called PAX TV, which distributes programming on its 71 stations in 62 markets and 124 affiliate television stations, reaching 96% of all US households.
Scripps will pay $2.65 billion for West Palm Beach, Fla.-based ION Media. Warren Buffett’s Berkshire Hathaway will make a $600 million preferred stock investment in Scripps to fund the transaction announced this morning, Scripps said.
Scripps will create “a national television network business” by combining ION with its news network Katz Networks (Court TV, Bounce, Laff, Grit) and Newsy. ION reaches more than 100 million households through live and pay-TV platforms, and has the “fifth-largest average prime-time viewership among all cable networks,” the press release said.
Scripps, which operates 60 television stations in 42 markets, will sell 23 ION stations to comply with Federal Communications Commission regulations. Scripps agreed to a transaction with a buyer, who agreed to maintain ION’s affiliations with the stations, said Kari Wetherington, Scripps senior director of external communications.
ION is being purchased from Black Diamond Capital Management, which acquired a stake in the company in 2009. Pending FCC approval, the deal is expected to close before April next year, Scripps said. ION has 425 employees.
Today, ION primarily airs repeats of crime and justice dramas from NBC and CBS: Law & Order, Law & Order: Criminal Intent, Law & Order: SVU, Chicago PD, NCIS; Los Angeles, criminal minds and Blue blood.
“Combining ION with Katz and Newsy, who also derive primarily revenue from national advertising, will increase Scripps’ reach in this sustainable advertising market as it provides advertisers with a broader platform on which to reach their audience. Together, ION, Katz and Newsy, Scripps’ new national networking venture, will reach nearly every American through free over-the-air, cable/satellite, over-the-air, and digital distribution, with multiple streams of ad-supported programming” , said Scripps.
It will be the biggest presence on the national television landscape since the Cincinnati media company, founded in 1878, spun off its popular HGTV, Food Network and Travel Channel cable division as Scripps Network Interactive in 2008. (This company was purchased by Discovery Communications in 2018.)
ION was founded as Paxson Communications by Florida businessman Lowell “Bud” Paxson, who sold his radio group and major network subsidiaries in 1998 to focus on building the television network independent PAX via UHF stations.
The network has never been known to produce its own content. PAX TV launched in 1998 with off-network reruns of Touched By An Angel, Highway To Heaven, Meet Lucy, The Hogan Family and Dr. Quinn, medicine woman. The network changed its name to ION in 2006 after Paxson left the company when NBC acquired 32%.
“This evolution of Scripps’ national television networks business, through the combination of ION, Katz Networks and Newsy, repositions the company in the television landscape,” said Adam Symson, president and chief direction of Scripps, in the press release. “With its strong revenue growth, high margins and strong cash flow, ION will make Scripps a more powerful and sustainable media company with significant short-term benefits as well as long-term value. ION Media is a dual distribution threat – transmitted via cable and satellite must carry (deals) while capitalizing on cord cutting and the growth of free-to-air streaming This transaction is another in a long list of transformative moves from Scripps to where we see opportunities for growth and to benefit from the changing media landscape.
“For more than 70 years, Scripps has been dedicated to local broadcasting and the markets we serve with an unparalleled commitment to quality, objective journalism, community service and stewardship of the public airwaves,” said Symson. “Now, with this national broadcast acquisition, Scripps will be the largest holder of broadcast spectrum, poised to play an even greater role in developing future business models…for the benefit of the American people.”