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Nexstar Targets Political Capital With The Hill

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Published: August 24th, 2021
The TV station group is paying $130 million for the Washington news organization backed by the family office of Apollo Global co-founder Josh Harris and Jimmy Finkelstein.

Acquisitive TV station group Nexstar Media Group Inc. (NXST) is increasing its political acumen with the $130 million purchase of Washington publisher The Hill, the companies said Aug. 20.

The sellers are chairman Jimmy Finkelstein and HRS Management LLC, the family office of Apollo Global Management Inc. (APO) co-founder Josh Harris.

Founded in 1994, The Hill is a political digital media news organization with 48 million average monthly users, the companies said.

The payout is modest compared to Nexstar’s $1.33 billion in projected 2021 and 2022 free cash flow, Wells Fargo Securities LLC analyst Steven Cahall wrote in an Aug. 23 note. TV station groups often average metrics from even and odd years to account for the increase in political ad sales.

Politics is a sweet spot for Nexstar, which owns, operators or provides programming or other services to nearly 200 U.S. TV stations. The Texas broadcaster generated more than $500 million in political advertising in 2020 and reported a record fourth-quarter tally of $298 million in political ad sales during the race between President Biden and Trump.

Nexstar said The Hill dovetails with its news operations, including NewsNation, a three-hour daily newscast that the company’s WGN America network launched in September. Nexstar acquired WGN America through the $7.2 billion purchase of Tribune Media Co. in 2019.

While Nexstar does not project the the political ad sales will 2022 races to exceed the 2000 presidential campaigns, CEO Perry Sook predicted a strong political cycle during the company’s second-quarter earnings call on Aug. 4. “It continues to become more interesting as time goes on with the retiring senators in battleground states like Ohio and Pennsylvania, with the uncertain situation with the governor in California and whether there’ll be a recall and all of that,” Sook said of the 2022 political outlook.

Editor’s note: The original version of this article was published earlier on The Deal’s premium subscription website. For access, log in to TheDeal.com or use the form below to request a free trial.

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