Deal: 8 TV stations to sell for $1.1 billion by News Corp.

Tribune Co.'s new venture to spread the costs of some television operations across its 23 stations and those of Oak Hill Capital Partners' Local TV LLC will get to spread those costs over an even wider swath than first announced.
News Corp., the media company controlled by Rupert Murdoch, will sell eight of its Fox network-affiliated television stations in the U.S. to Oak Hill Capital Partners for about $1.1 billion in cash.
The sale in small markets will leave News Corp. with 27 stations in major markets including New York, Boston and Los Angeles.
The media conglomerate, which owns the New York Post, a controlling stake in BSkyB satellite TV service, and 20th Century Fox movie studio, recently closed a $5.6 billion deal to buy the Wall Street Journal publisher, Dow Jones.
The sale will probably be completed in the third quarter, News Corp. said in a statement Saturday. The purchase will help Oak Hill, the buyout firm founded two years ago by Robert Bass, a Texas oil billionaire, create a broader U.S. network. In May it paid $575 million to acquire stations in Oklahoma, Pennsylvania, Iowa and Arkansas from The New York Times Co.
"It is part of News Corp.'s strategic decision to shed low-growth, noncore assets," said Richard Dorfman, managing director of the investment firm Richard Alan.
For Oak Hill, the purchase is "a classic private equity play," Dorfman said. "Ad dollars are migrating to the Web, but it's a government-licensed franchise that can throw off good cash flow and reliably service debt."
Oak Hill will get WJW in Cleveland; KDVR in Denver; KTVI in St. Louis; WDAF in Kansas City, Missouri; WITI in Milwaukee; KSTU in Salt Lake City, Utah; WBRC in Birmingham, Alabama; and WGHP in Greensboro, North Carolina, according to the News Corp. statement confirmed by Teri Everett, a spokeswoman.
Oak Hill has expanded into leveraged buyouts, high-yield debt and hedge funds, raising more than $4.6 billion from investors, including Bill Gates, the founder of Microsoft.
News Corp. hired the New York investment banking firm Allen & Co. to advise it on the sale of the TV stations in June. Two months later, it agreed to buy Dow Jones, publisher of Dow Jones Newswires, Barron's and The Wall Street Journal, after months of negotiations with the controlling Bancroft family.
Murdoch plans to use the Wall Street Journal brand to attract viewers to its television networks and Internet users to Web sites.
"News Corp.'s focus today is much more on Internet properties, such as MySpace, and cable," said Dorfman. The sale of the stations "will help News Corp. raise capital. News Corp. is not walking away from the healthy broadcast world."