Ion Media Networks
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(as Paxson Communications Corporation)
|Headquarters||West Palm Beach, Florida|
|R. Brandon Burgess - Chairman & CEO|
|Products||Ion Media Television
(through Ion Media Entertainment)
|Revenue||US$415 million (2014)|
|Owner||Media Holdco L.P.
(Black Diamond Capital)
(Majority - 85%)
Senior lenders from previous rounds of financing
(Minority - 15%)
Number of employees
Ion Media Networks, Inc. (formerly known as Paxson Communications Corporation) is an American broadcasting company that owns and operates over 60 television stations in most major American markets, as well as a digital sub-channel through that group & a major commercial television network. It is now a privately owned company.
As Paxson Communications Corporation
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The company was founded in 1988 by Lowell W. "Bud" Paxson in Florida. The company purchased radio stations and a couple television stations, eventually becoming Florida's largest radio group. The radio stations ranged from rock to contemporary hit radio to adult contemporary to news and talk. The television stations were network affiliates of ABC and NBC. In 1993 the company began to purchase stations on the outer fringes of large television markets.
The company divested itself of both the radio group and major-network affiliated television stations in 1998, focusing on building its own independent TV network, "PAX TV". The company focused on acquiring UHF television stations. Some of these stations are out-of-market stations, such as WPXD in Ann Arbor, Michigan (45 miles (72 km) from Detroit), KXLI in St. Cloud, Minnesota (60 miles (97 km) from Minneapolis), WTLK in Rome, Georgia (45 miles (72 km) from Atlanta), WPXJ in Pavilion, New York (45 miles (72 km) from both Buffalo, New York and Rochester, New York), and WAYK in Melbourne, Florida (60 miles (97 km) from Orlando). Still in some markets the company bought low rated stations that had the same type of signals as established stations with medium to high ratings. These stations included WCFC in Chicago (religious), WTGI in Wilmington, Delaware (brokered), WAKC in Akron, Ohio (Cleveland's secondary ABC affiliate), and channel 35 in Miami (Shopping), among others. In the fall of 1997, a tentative lineup was announced, and it included a family entertainment lineup of drama shows, movies, first run shows, wildlife shows, sitcoms, and talk shows. The most expensive station acquisition was WBIS in New York City. The city government had sold this station to Dow Jones and ITT in 1996 for nearly US$200 million. In January 1997, Dow Jones launched a business format called S+ during the day and a sports channel after 7 pm and on weekends. Dow Jones/ITT lost money on the operation, sold the station for about $225 million in May 1997, and shut down S+ that June in favor of Bloomberg Business News, Fox Sports Net and a block previewing new networks, IntroTV. Channel 31 was renamed WPXN with plans to be the flagship station of PAX TV in the fall of 1998.
In Pittsburgh, Pennsylvania, the company wanted to buy WPCB, channel 40, from Cornerstone Television, and move the license to channel 16 (which was, and still is, occupied by WINP-TV), with channel 40 used for educational purposes. The two agreed on a purchase price, but the Federal Communications Commission had too many questions about the deal, most relating to the type of broadcast license to be operated on each channel, and it fell through.
The PAX network was launched in 1998 with family dramas such as Life Goes On, Touched by an Angel, Dr. Quinn, Medicine Woman, Highway to Heaven, and Bonanza, a game show titled The Reel to Reel Picture Show, sitcoms Dave's World, Here's Lucy and The Hogan Family, and some movies. The network ran weekdays from noon until 1 am. Due to low ratings and mounting financial costs, PAX TV soon reduced its hours. In 1999, they were reduced to between 3 pm and midnight, and in 2002, they were reduced again to 6 pm to midnight.
In September 1999, NBC bought a 32% stake in Paxson. On December 4, 2001 it was announced that Paxson had filed with the FCC an arbitration to block NBC's acquisition of Telemundo. In September 2002, it was announced that Paxson's arbitration against NBC was denied. On November 13, c NBC requested a redemption of its investment in Paxson of $549.2 million. In August 2004, NBC Universal filed a lawsuit against Paxson. In November 7, 2005, to settle several lawsuits between the company and NBC Universal, Lowell Paxson granted NBCU an 18-month transferrable option to purchase his shares of the company in an agreement which, if activated, would also trigger a sale of the rest of the company. If Mr. Paxson's shares of the company weren't sold in the option window, the company was obligated to buy them back from Mr. Paxson. Concurrent with this deal, Mr. Paxson left the company, and was succeeded by R. Brandon Burgess in the role of President and CEO.
As Ion Media Networks
In May 2007, Ion, NBC Universal, and Citadel LLC reached an agreement for the recapitalization of Ion. Citadel has acquired the public common stock of the company, as part of the plan to take the company private. In addition, Citadel invested $100 million of new capital into the company to further support management's plan to revitalize the TV network.
In November 2007, Ion Media Networks was taken to trial, having been sued in Federal Court by Positive Ions, Inc for trademark infringement of the use of the word ion, resulting in a $1.7 million settlement awarded to Positive Ions, Inc.
In April 2009, it was announced that Ion Media Networks was once again facing balance sheet problems. The company disclosed that it was in discussions with lenders on "a comprehensive recapitalization" of its balance sheet. That translates to an effort to restructure its considerable debt, which stands at $2.7 billion as of April 2009, according to The Wall Street Journal.
On May 19, 2009, Ion Media Networks filed for chapter 11 bankruptcy protection, putting the Ion network under bankruptcy for the second time, saying it had reached an agreement with holders of 60% of its first lien secured debt that would extinguish all of its $2.7 billion in legacy debt and preferred stock and recapitalize the company with a $150 million new funding commitment. It emerged from bankruptcy in December, under the ownership of its bondholders & secured lenders/first lien holders, wiping out Citadel's ownership.
In late 2009, a trio of private equity companies (Black Diamond, Avenue, & Trilogy Capital) purchased a 62.5% controlling stake in Ion Media Networks from the Ion Media Liquidating Trust (the legal entity selling the stake) through their partnership, Media Holdco L.P. (43.7% owned by Black Diamond via its BD ION Media GP Holdings subsidiary; 15.8% by Trilogy via its Trilogy ION, LLC subsidiary; & 40.5% by Avenue via its Avenue ION Holdings LP subsidiary). The remaining 37.5% of Ion Media Networks remained with the company's senior investors from previous rounds of financing.
By 2012, Media Holdco's stake in Ion Media Networks was at 87%, with the company's senior investors from previous rounds of financing holding 13%.
In December 2013, the United States bankruptcy court approved a plan by creditors of Roberts Broadcasting to transfer East St. Louis-based WRBU and its sister stations, WZRB in Columbia, South Carolina and WAZE-LP in Evansville, Indiana, to a trust with ION Media Networks (a creditor in Roberts' chapter 11 bankruptcy proceedings, which it filed for in 2011) as its beneficiary, with Roberts' attorney subsequently stating that Ion Media Networks would purchase the three stations. The deal is complete in February 10, 2014, and both WZRB and WRBU became Ion stations.
Also in December 2013, Black Diamond purchased Avenue & Trilogy's stakes in Media Holdco, placing Black Diamond as Media Holdco's sole shareholder.
As of November 2014, Media Holdco's majority equity stake in Ion Media Networks is at 85%, leaving the company's senior investors from previous rounds of financing with a minority stake of 15%.
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- "Paxson loses arbitration against NBC". South Florida Business Journal. September 23, 2002. Retrieved 2012-10-15.
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- "Bud Paxson departs Paxson, NBC may buy out or sell out". South Florida Business Journal. November 7, 2005. Retrieved 2012-10-15.
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- Kouwe, Zachery (May 4, 2007). "ION APPROVES NBC SALE AMID UNREST". New York Post. Retrieved October 15, 2012.
- Federal Judge to Decide Whether Ion Television Can Continue as Ion , Positive Ions v. ION Media Networks.
- Judgment Entered Against Ion Media Networks, Inc. in Dispute Over "ION" Trademark Registration, Positive Ions v. ION Media Networks.
- Ion Media Plugs In New Comcast Accord, MultiChannel News, January 14, 2008
- Ion Files for Bankruptcy Protection, Multichannel News, May 20, 2009
- Ion Media Emerges From Bankruptcy, Leveraged Finance News.
- "S&P rates Media Holco". reuters.com. Reuters. Reuters. Retrieved 6 Dec 2012.
- TVBR, RBR-. "New backers DIP into ION". rbr.com. Radio + Television Business Report. Retrieved 14 September 2009.
- TVBR, RBR-. "Big markets, but big problems". rbr.com. Radio + Television Business Report. Retrieved 15 September 2009.
- "ION Media Networks Inks Multi-Affiliate Deals for Diginets". Telecommunications Weekly. May 26, 2010. Retrieved February 22, 2014.
- "Moody's assigns Media Holdco (ION) B1 CFR and B2 term loan rating; outlook is stable". moodys.com. Moody's Investors Service. Retrieved 26 December 2012.
- Mueller, Angela (December 11, 2013). "Judge approves creditors' proposal in Roberts Broadcasting bankruptcy". St. Louis Business Journal. Retrieved December 11, 2013.
- Brown, Lisa (December 11, 2013). "Roberts' TV stations to be sold". St. Louis Post-Dispatch. Retrieved December 11, 2013.
- Wright, Natalie. "ION Media readies $795M dividend recap loan". reuters.com. Reuters. Reuters. Retrieved 3 Dec 2013.