KARK's Owner Buys Equity Media Station

Nexstar Broadcasting Group Inc. has entered into an agreement to buy a Little Rock TV station owned by Equity Media Holdings Corp. of Little Rock.

Nexstar of Irving, Texas, agreed to pay $4 million to the ailing Little Rock broadcasting company, according to a Nexstar release.

KWBF-TV, a MyNetworkTV affiliate, will complement Nexstar's existing Little Rock property, KARK-TV, Channel 4, which is an NBC affiliate. Nexstar will own 51 stations once the deal is finalized.

"This transaction reflects Nexstar's long-term strategy of identifying accretive acquisitions and prudently expanding our portfolio by operating multiple stations in concentrated geographic areas," Perry A. Sook, Nexstar president and CEO, said in a news release. "Under Nexstar's ownership, KWBF-TV will realize additional retransmission revenues and we'll achieve operating and financial synergies between KARK-TV and KWBF-TV."

The release indicates that the stations will merge together to "focus on leveraging our existing local sales teams, award-winning local news and e-Media operations across both stations," Sook said.

The purchase price amounts to less than six times KWBF's revenue during the past year, the release states.

Nexstar, which owns stations in 11 states, will pay for the purchase using cash.

Equity Media did not return a call for comment.

Equity Media (NasdaqCM: %%EMDA%%) has sold several properties since the beginning of this year. The company lost $40.7 million in 2007 and disclosed that without an infusion of cash, it might close up shop, according to its 2007 annual report filed with the Securities & Exchange Commission.

"The company's existing capital resources are not sufficient to fund operations. If the company is unable to obtain adequate additional sources of capital in the near term it will need to cease all or a portion of its operations, seek protection under U.S. bankruptcy laws and regulations, engage in a restructuring or undertake a combination of these and other actions," the filing said.