According to Yahoo News, Byron Allen has made a preliminary $10 billion offer to acquire Walt Disney Co.'s ABC TV network, local stations, and the FX and National Geographic cable channels. The offer is based on the assumption that these properties generated $1.25 billion in earnings before interest, taxes, depreciation, and amortization (EBITDA) over the past 12 months. If the EBITDA figure is different, Allen would adjust his proposed price, which is based on a multiple of eight times EBITDA.
To finance the acquisition, Allen plans to work with banks and private equity firms. He may also sell the local TV stations he currently owns that are not affiliated with ABC to avoid friction with other networks like CBS and NBC. Allen has spent over $1.3 billion in recent years acquiring assets such as the Weather Channel and local stations from Honolulu to Tucson through his closely held Allen Media LLC.
Disney stated that while it is considering strategic options for its traditional TV networks, no decisions about a sale have been made. Nexstar Media Group Inc. has also held exploratory talks with Disney about acquiring the network and its eight local stations.