Apollo - Cox Media

The radio-TV synergies Cox Media Group has developed over the years in markets like Atlanta, Orlando, Jacksonville, Tulsa and Dayton will remain intact – even as parent Cox Enterprises all but exits the broadcasting business. After cutting a deal in February to buy the 14 Cox TV stations, an investor group led by Apollo Global Management has now agreed to buy all 63 Cox radio stations to form the backbone of a new broadcasting company.

Terms of the deal were not immediately disclosed.

Buying both platforms makes sense for Apollo because of the close intertwining of TV and radio in several Cox markets. When it signed the TV purchase agreement four months ago, the private equity firm rolled the Cox Dayton radio stations and Dayton Daily News into the deal because of the tight integration and synergy they rely on with WHIO-TV as a consolidated news operation. Similar resource sharing, cross-platform sales and management structures are in place across the Cox media map.

In addition to sound business sense, keeping the band together and retaining the Cox Media Group branding will also be good for logistics, continuity and employee morale. In a release announcing the deal, Alex Taylor, President and CEO, Cox Enterprises, said he was happy about keeping the radio and TV stations together. "Keeping these media businesses together gives us even more confidence in the future success of the new company,” Taylor said. “We have spent many years fostering a culture of collaboration and innovation across these businesses and are pleased to see that work will continue."

New Broadcast Player

But Wednesday afternoon’s announced purchase of the Cox radio group, the television rep firm CoxReps and the Gamut national advertising businesses may only be the beginning. Apollo plans to keep the existing operating structure of the radio, TV, rep firm and ad businesses intact and leverage the assets to build a national media company with station properties in key markets across the country. David Sambur, Chairman of the buyer and Senior Partner of Apollo, said he was “thrilled” to acquire the radio chain, TV rep firm and Gamut and combine them with the TV stations. "Cox has deep roots in the media industry and has stood for the highest quality in local journalism for the past 120 years. As we shepherd these businesses into the future, we are committed to investing in high quality programming and fostering innovation in local media,” Sambur said.

To satisfy FCC ownership limits, the investor group plans to spin off one FM in Orlando and one in Tampa.

Other Interested Parties

Speculation about a potential sale of the company’s radio group began shortly after Cox announced in late July 2018 that it was exploring a sale of its 14 television stations or a merger of them into a larger group. In the weeks after Cox announced the TV deal with Apollo, talks about selling the radio group heated up with broker chatter suggesting Cox wanted to sell the radio group en masse, rather than cutting piecemeal deals for individual markets. Hubbard Broadcasting and Beasley Media Group were apparently interested in some markets but neither wanted to buy the entire parcel, according to one broker. And efforts to split the radio group between the two companies in a pair of sales also proved unsuccessful.

Apollo is no stranger to broadcasting. Founded by CEO Leon Black, the PE firm was a major shareholder of Sirius Satellite Radio when it launched.

Eversheds Sutherland and Covington & Burling served as the legal advisors to Cox Enterprises in the transaction. RBC Capital Markets, Guggenheim Securities and LionTree Advisors served as the financial advisors and Paul, Weiss, Rifkind, Wharton & Garrison and Cooley served as the legal advisors to the buyer in the transaction. – Paul Heine