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KFMB could get flipped once more

Layoffs, news consolidation feared by critics of big hedge fund merger deal

Elisabeth Kimmel in 2019, as shown on ABC-10.
Elisabeth Kimmel in 2019, as shown on ABC-10.

Yet another radical change may soon be in sight for one of San Diego's biggest news sources, depending on the outcome of a titanic battle in Washington, D.C. between a controversial hedge fund owner and a group of labor unions and so-called public interest groups.

The announcement of the sale of KFMB by Elisabeth Kimmel and her family to Tegna, a broadcast chain once part of Gannet, for $325 million in cash had come in a December 18, 2017, news release.

"Through this transaction, Tegna adds a strong market to its portfolio of big four affiliates in top markets," said the company's release.

"San Diego is the 29th largest U.S. TV market with 1.1 million households and the 17th largest radio market."

This was about 15 months ahead of the public release of the indictment in March 2019 of Kimmel for her college bribery scheme.

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Kimmel last year pled guilty to mail and wire conspiracy charges regarding her use of a non-profit family foundation in a scheme to get her daughter into Georgetown University and son into University of Southern California with phony athletic resumes.

Kimmel got six weeks in federal prison and a yearlong period of house arrest, along with a year of probation and a requirement to do 500 hours of community service.

During Kimmel's time running the KFMB stations, Kimmel, a well-connected La Jolla Republican linked to Roger Hedgecock and Carl DeMaio, kept to the longstanding family tradition of using them to play politics and avoiding digging up embarrassing local malfeasance.

Those cozy ties between the stations and politics appear to have been cut following the Tegna acquisition, but now the operation faces a new challenge, because of the prospective takeover of Tegna, once part of Gannett, by Wall Street giants Standard General and Apollo Global Management.

“Standard General would acquire Tegna’s 61 full power television stations and two radio stations across 50 markets,” per an August 2 account by the website TVTech.

“Apollo will control the licenses of 31 full-power television stations in 26 markets and 54 radio stations in 11 radio markets. “

The $8 billion-plus deal is currently being held up at the Federal Communications Commission by challenges from labor unions and civil rights groups, including NewsGuild-CWA, the National Association of Broadcast Employees and Technicians-CWA, United Church of Christ's Media Justice Ministry, and recently Common Cause.

In an August 1 declaration filed in the case, the opponents contend that the would-be takeover partners "and their anonymous funders located in the Cayman and British Virgin Islands have proposed a complex series of transactions designed to weaken local journalism and jack up cable subscriber fees. Grant of their pending applications will do nothing to create a more accurate, diverse or independent media. "

"The Applicants defend Standard General's stated plans to increase cookie-cutter, nationally distributed content from a Washington ‘news desk,’ disregarding the inevitable reduction in locally originated programming.

“In the face of clear indications that the claimed financial ‘synergies’ arising from these transactions depend on job reductions at the local level, the Applicants merely reiterate Standard General’s vague and utterly unenforceable assurance that it has ‘no intention’ to reduce local employment headcounts across Tegna's footprint."

The opponents contend that "a driving force behind the complex financial maneuvering in this case is Standard General’s desire to manipulate so-called after acquired station clauses to jack up retransmission fees for pay-TV operators."

Standard General, run by hedge fund operator Soo Kim, stoked those fears with an April 2020 statement during a takeover battle questioning Tegna's profitability, adding that Tegna has “2x the number of employees per station compared to peers”

"Basically a hedge fund guy, Kim got in the broadcasting biz by buying the 11-station Young Broadcasting out of Chapter 11 in 2010." says a February dispatch on the website TVNewsCheck.

"Spending extra on news doesn’t produce measurable financial returns and so it is vulnerable to the cost cutters who inevitably show up soon after the early assurances of new ownership that they love, just love, what they old guys were doing and don’t want to change a thing.

“And it not just news department that may get a trim. This is another deal that is going to load up Tegna’s balance sheet with more debt. Somebody has got to pay that down."

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Elisabeth Kimmel in 2019, as shown on ABC-10.
Elisabeth Kimmel in 2019, as shown on ABC-10.

Yet another radical change may soon be in sight for one of San Diego's biggest news sources, depending on the outcome of a titanic battle in Washington, D.C. between a controversial hedge fund owner and a group of labor unions and so-called public interest groups.

The announcement of the sale of KFMB by Elisabeth Kimmel and her family to Tegna, a broadcast chain once part of Gannet, for $325 million in cash had come in a December 18, 2017, news release.

"Through this transaction, Tegna adds a strong market to its portfolio of big four affiliates in top markets," said the company's release.

"San Diego is the 29th largest U.S. TV market with 1.1 million households and the 17th largest radio market."

This was about 15 months ahead of the public release of the indictment in March 2019 of Kimmel for her college bribery scheme.

Sponsored
Sponsored

Kimmel last year pled guilty to mail and wire conspiracy charges regarding her use of a non-profit family foundation in a scheme to get her daughter into Georgetown University and son into University of Southern California with phony athletic resumes.

Kimmel got six weeks in federal prison and a yearlong period of house arrest, along with a year of probation and a requirement to do 500 hours of community service.

During Kimmel's time running the KFMB stations, Kimmel, a well-connected La Jolla Republican linked to Roger Hedgecock and Carl DeMaio, kept to the longstanding family tradition of using them to play politics and avoiding digging up embarrassing local malfeasance.

Those cozy ties between the stations and politics appear to have been cut following the Tegna acquisition, but now the operation faces a new challenge, because of the prospective takeover of Tegna, once part of Gannett, by Wall Street giants Standard General and Apollo Global Management.

“Standard General would acquire Tegna’s 61 full power television stations and two radio stations across 50 markets,” per an August 2 account by the website TVTech.

“Apollo will control the licenses of 31 full-power television stations in 26 markets and 54 radio stations in 11 radio markets. “

The $8 billion-plus deal is currently being held up at the Federal Communications Commission by challenges from labor unions and civil rights groups, including NewsGuild-CWA, the National Association of Broadcast Employees and Technicians-CWA, United Church of Christ's Media Justice Ministry, and recently Common Cause.

In an August 1 declaration filed in the case, the opponents contend that the would-be takeover partners "and their anonymous funders located in the Cayman and British Virgin Islands have proposed a complex series of transactions designed to weaken local journalism and jack up cable subscriber fees. Grant of their pending applications will do nothing to create a more accurate, diverse or independent media. "

"The Applicants defend Standard General's stated plans to increase cookie-cutter, nationally distributed content from a Washington ‘news desk,’ disregarding the inevitable reduction in locally originated programming.

“In the face of clear indications that the claimed financial ‘synergies’ arising from these transactions depend on job reductions at the local level, the Applicants merely reiterate Standard General’s vague and utterly unenforceable assurance that it has ‘no intention’ to reduce local employment headcounts across Tegna's footprint."

The opponents contend that "a driving force behind the complex financial maneuvering in this case is Standard General’s desire to manipulate so-called after acquired station clauses to jack up retransmission fees for pay-TV operators."

Standard General, run by hedge fund operator Soo Kim, stoked those fears with an April 2020 statement during a takeover battle questioning Tegna's profitability, adding that Tegna has “2x the number of employees per station compared to peers”

"Basically a hedge fund guy, Kim got in the broadcasting biz by buying the 11-station Young Broadcasting out of Chapter 11 in 2010." says a February dispatch on the website TVNewsCheck.

"Spending extra on news doesn’t produce measurable financial returns and so it is vulnerable to the cost cutters who inevitably show up soon after the early assurances of new ownership that they love, just love, what they old guys were doing and don’t want to change a thing.

“And it not just news department that may get a trim. This is another deal that is going to load up Tegna’s balance sheet with more debt. Somebody has got to pay that down."

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1

While this piece wasn't about Elisabeth and was reporting on the ownership of the stations, there is more to add about her. She was sentenced to six weeks in custody, followed by a year of home confinement. She avoided the six weeks of Club Fed because as it was reported elsewhere, due to "debilitating medical circumstances." That six weeks was served in home confinement too.

The YouTee soft pedaled the story about her while running wire service stories about the two aging TV glamor girls, Felicity and Lori. I called out the YouTee readers' rep, Adrian Vore, about the weak coverage of her, and he of course denied that it was in any being pressured to ignore the matter. Then they did run a fairly complete story about her, and I recall it being on the front page. I wondered what kind of influence she had in keeping the story suppressed here locally. I strongly doubt that there will be any YouTee wrap up stories.

She received a lenient sentence, whereas a pair of rich, as in billionaire, guys went to trial and were convicted. One got a multi-year sentence if I remember right.

Sept. 2, 2022

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