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The proposed sale of state-owned WOI-TV comes at a time when the market for television stations is soft, and industry analysts say it will not improve any time soon.
"It's tough for network affiliates," said Bishop Sheen, a senior analyst with Paul Kagan Associates, a media consulting firm in Carmel, Calif. "They're probably at the lowest market valuation since the early 1980s."
Sheen said competition from cable television and videotapes, an advertising slump within the broadcasting industry and an overall credit crunch have made it difficult to sell television stations.
Television stations traded hands frequently in the mid-to-late 1980s, during the heyday of mergers and acquisitions. However, there are now fewer buyers looking for stations and most sellers aren't willing to accept leveraged deals anymore.
"Broadcast properties were not excluded from the acquisition craze of the 1980s," said James Goss, a media analyst for Duff & Phelps in Chicago. "Values have been scaled back since then."
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The fact that all four of Des Moines' commercial television stations have been sold or put on the market in the past year "speaks well for the (Des Moines) market," Sheen said. "It says nice things about it."
But WOI, whose sale was still pending last week after the Iowa legislature attempt to stop it, cannot be easily evaluated by most market analysts because of its unusual status as a university-run television station.
Sheen's firm valued WOI at $12.3 million, a figure based on the station's cash flow, its potential to make money and other factors.
Another media analyst, Bortz and Co., put the price between $13.5 million and $15.5 million. Citadel Communications Inc. of New York has offered to buy the station from Iowa State University for $14 million.
The WOI sale is currently being held up by politics. But it isn't the only Des Moines-area station that has been put on, and then taken off, the market recently.
WHO-TV and other properties owned by Palmer Communications Inc. were put up for sale late last year. Palmer agreed to sell the stations...