Bally’s Chicago Casino Helping Fund Nexstar Media’s The CW Acquisition
Posted on: November 17, 2022, 11:32h.
Last updated on: November 17, 2022, 12:40h.
Bally’s Corp. continues to make progress in building Chicago’s lone downtown integrated casino resort. The more than $1.7 billion development will ideally provide the Windy City with an array of economic and societal benefits. But the undertaking is also helping to fund a major media acquisition.
Nexstar Media Group, the nation’s largest owner of local television stations with nearly 100 network affiliates, has agreed to sell the Freedom Center in Chicago to Bally’s for about $200 million. Also known as the Chicago Tribune publishing center, Bally’s plans to demolish the entire printing plant and newspaper offices following the transaction’s execution.
Nexstar revealed this week that it plans to use its net proceeds from the Freedom Center sale to help finance its recent 75% acquisition of The CW. The transaction with WarnerMedia and ViacomCBS closed last month.
Though financial terms of the deal were not disclosed publicly, Variety reported in August that Nexstar is not paying any cash for The CW. Instead, it is assuming the network’s more than $100 million in debt. Nexstar brass says the company believes it can turn the network profitable by 2025.
Casino Sale Financing
Once it completes its $200 million sale of the Freedom Center to Bally’s, Nexstar will use the roughly $155 million in net cash proceeds to cover its CW purchase.
From a funding perspective, we’re in the process of selling one of the remaining properties we had in Chicago for $155 million of net cash,” Nexstar CFO Lee Ann Gliha explained this week during an investor’s conference hosted by financial services firm Stephens. “That goes a long way to funding the investment that we’re going to have in the CW.”
During Nexstar’s third-quarter earnings release earlier this month, Gliha said she expects the Freedom Center sale to close by the end of November.
Once Bally’s becomes the owner of the Freedom Center, the Rhode Island-based casino company will be able to proceed with demolishing the property’s current buildings.
It’s unclear where the Chicago Tribune and the other newspapers and publications that are currently printed at the Freedom Center, including the Chicago Sun-Times, will be printed in the future. Tribune Publishing, which publishes the Chicago Tribune, has a lease with Nexstar to print the paper at the Freedom Center that runs through June 2023.
Nexstar acquired the Freedom Center through its $4.1 billion takeover in 2019 of Tribune Media, the former television broadcast arm of Tribune Publishing. The deal did not include Tribune’s news division.
Bally’s wasn’t the first to consider redeveloping the Freedom Center.
A year before its takeover by Nexstar, Tribune Media mulled redeveloping the site into a mixed-use destination with hotels, thousands of residential units, office space, and an abundance of retail shopping, dining, and entertainment. Tribune Media had the property rezoned for such a development.
Bally’s, pending final approval from the Illinois Gaming Board, plans to build a sprawling integrated resort highlighted by a casino floor with 3,400 slot machines, 170 table games, and a sportsbook. The facility will be complemented by a 500-room hotel, 3,000 seat theater, an outdoor music venue, and six restaurants and bars.
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