The impact of a national credit crunch and the collapse of a major Wall Street investment bank have managed to scuttle the pending sale of Nashville's WTVF-TV, NewsChannel 5, to a New York media company.
On Wednesday, Bonten Media Group, Inc., said it notified Norfolk, Va.-based Landmark Media Enterprises, LLC, that it would not be able to "close on the acquisition on time" because financing had evaporated with the collapse of now-bankrupt Lehman Brothers, which failed amid $600 billion in bad debt this fall.
"It's just a terrific TV station and we're very disappointed," said Randall D. Bongarten, Bonten's chairman. "Sometimes things happen that are beyond your control."
After receiving word from Bonten, Landmark ended the July agreement to sell the highly rated CBS network affiliate here. The sale was originally announced in July as Landmark moved to sell virtually all its TV, newspaper and cable broadcast holdings.
Landmark President Decker Anstrom said there are no other potential buyers lined up, and that Landmark would continue to operate WTVF as it has been.
"It's a premium property, we have a great leadership team there, and we're happy to keep running the good businesses we have," he said from his Norfolk office.
At WTVF, it will continue to be "business as usual," said Debbie Turner, president and general manager. "The economy is out there for all of us to worry about, but Nashville is a great market to be in, and we're having a great year."
WTVF is Nashville's top-rated TV station and one of the top stations among CBS network affiliates.
Credit markets around the world have "seriously deteriorated after the failure of Lehman Brothers, through whom we had arranged financing for the acquisition," Bongarten said in a statement. "Despite vigorous efforts, we have not been able to replace the Lehman Brothers commitment."
Lehman was among the first major Wall Street firms to drop as toxic loans and other problems ripped through financial markets earlier this fall.
Tough year for mediaBongarten would not speculate as to whether Bonten might revive its bid for WTVF should the economy and the credit markets improve to the point where financing could be obtained.
"I really don't know what the future will bring," Bongarten said. "It's been a tough year all around for the media business."
Bonten, founded in November 2006, owns a chain of 16 TV stations in eight markets. Nashville would have become the biggest market in the chain.
Channel 5 is one of two TV stations owned by Landmark; the other is in Las Vegas. The company also has a chain of daily and community newspapers, and was the founder, in 1982, of cable TV's The Weather Channel.
Landmark, owned by the Norfolk-based Batten family, said in January that it was exploring the sale of all of its businesses, including the TV stations, newspapers and The Weather Channel.
The Battens have not said why they decided to sell the business but in July, The Weather Channel and its popular Web site, weather.com, were sold to a group of investors led by NBC Universal for a reported $3.5 billion.
No buyers have been announced for the other Landmark properties, including its large daily newspapers — the Virginian Pilot and The Roanoke Times in Virginia and the News & Record in Greensboro, N.C., and about 50 community newspapers.
"We are in discussions and negotiations on some of our properties, but it's a tough market for everybody in terms of credit," Anstrom said.
Landmark's chairman is Frank S. Batten Jr., who took over that position from his father in 1998. Frank Batten Sr. assumed control of Landmark in 1954 from his uncle, Tennessee native Samuel L. Slover, who started the business in the Norfolk area after moving there in 1900.
Deploy A Strategic Assault On Your Mortgage Application
Nashville home sales slide 32 percent
