Malara Broadcast Group
Encyclopedia
Malara Broadcast Group of Sarasota, Florida
, a Delaware
corporation, also known as Malara Broadcasting, is a broadcasting holding company
. Malara Broadcasting was founded in 2004 by Tony Malara, former president of affiliate relations for CBS
. Malara currently owns two television stations: KDLH
in Duluth, Minnesota
and WPTA
in Fort Wayne, Indiana
.
and WPTA
. This marks Malara's first action as a company. These purchases were completed in early March of 2005.
On March 8, 2005, Malara Broadcast Group entered into a credit agreement with Granite Broadcasting Corporation
. This agreement gave Malara Broadcasting $48.5 million and a revolving credit
line of $5 million, which it used to purchase KDLH
(from former owner New Vision Television
) and WPTA
, from Granite. In addition to this agreement, Malara also entered into a second agreement with Granite, under which Granite would operate, promote, and sell advertising for the two Malara stations. This is known as a local marketing agreement
.
The future of Malara Broadcasting may be in doubt given several recent occurrences stemming from the death of group founder Tony Malara from leukemia
and a heart attack on August 24, 2006, as well as financial woes of partner Granite Broadcasting which filed for Chapter 11 bankruptcy
on December 11, 2006. Both the future of the Granite group and any rulings on who would get control of Malara could lead to massive changes with the company. Granite emerged from bankruptcy in mid-2007 under the control of the Connecticut
-based private equity firm Silver Point Capital, who also controls Communications Corporation of America
, White Knight Broadcasting
and selected Spanish-language stations acquired from Equity Media Holdings.
Malara Broadcasting files its financial results to the SEC
jointly with Granite, leading many to believe that it is simply a shell corporation for Granite. If this is true, Granite and Malara would be in violation of the FCC's rules on duopolies
. FCC regulations do not allow duopolies between two of the four highest-rated stations in a market. Additionally, neither Fort Wayne and Duluth have enough full-power stations to legally permit a duopoly in any case. Fort Wayne and Duluth have only six full-power stations each, and FCC regulations require a market to have eight unique station owners once a duopoly is formed--effectively restricting duopolies to markets with at least nine full-power stations. Similar allegations surround Cunningham Broadcasting
, which many believe is simply a shell for Sinclair Broadcast Group
.
Sarasota, Florida
Sarasota is a city located in Sarasota County on the southwestern coast of the U.S. state of Florida. It is south of the Tampa Bay Area and north of Fort Myers...
, a Delaware
Delaware
Delaware is a U.S. state located on the Atlantic Coast in the Mid-Atlantic region of the United States. It is bordered to the south and west by Maryland, and to the north by Pennsylvania...
corporation, also known as Malara Broadcasting, is a broadcasting holding company
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
. Malara Broadcasting was founded in 2004 by Tony Malara, former president of affiliate relations for CBS
CBS
CBS Broadcasting Inc. is a major US commercial broadcasting television network, which started as a radio network. The name is derived from the initials of the network's former name, Columbia Broadcasting System. The network is sometimes referred to as the "Eye Network" in reference to the shape of...
. Malara currently owns two television stations: KDLH
KDLH
KDLH is the CBS-affiliated television station for the Iron Range area of Northeastern Minnesota that is licensed to Duluth. It broadcasts a high definition digital signal on UHF channel 33 from a transmitter west of downtown in Hilltop Park. Owned by the Malara Broadcast Group, the station is...
in Duluth, Minnesota
Duluth, Minnesota
Duluth is a port city in the U.S. state of Minnesota and is the county seat of Saint Louis County. The fourth largest city in Minnesota, Duluth had a total population of 86,265 in the 2010 census. Duluth is also the second largest city that is located on Lake Superior after Thunder Bay, Ontario,...
and WPTA
WPTA
WPTA is the ABC-affiliated television station for Northeastern Indiana licensed to Fort Wayne. It broadcasts a high definition digital signal on UHF channel 24 from a transmitter at its studios on Butler Road. The station can also be seen on Comcast and Frontier FiOS channel 7...
in Fort Wayne, Indiana
Fort Wayne, Indiana
Fort Wayne is a city in the US state of Indiana and the county seat of Allen County. The population was 253,691 at the 2010 Census making it the 74th largest city in the United States and the second largest in Indiana...
.
History
On April 23, 2004, Malara Broadcast Group entered into agreements to purchase KDLHKDLH
KDLH is the CBS-affiliated television station for the Iron Range area of Northeastern Minnesota that is licensed to Duluth. It broadcasts a high definition digital signal on UHF channel 33 from a transmitter west of downtown in Hilltop Park. Owned by the Malara Broadcast Group, the station is...
and WPTA
WPTA
WPTA is the ABC-affiliated television station for Northeastern Indiana licensed to Fort Wayne. It broadcasts a high definition digital signal on UHF channel 24 from a transmitter at its studios on Butler Road. The station can also be seen on Comcast and Frontier FiOS channel 7...
. This marks Malara's first action as a company. These purchases were completed in early March of 2005.
On March 8, 2005, Malara Broadcast Group entered into a credit agreement with Granite Broadcasting Corporation
Granite Broadcasting Corporation
Granite Broadcasting Corporation, founded by W. Don Cornwell and Stuart Beck in 1988 , is a broadcasting holding company which owns or operates 14 television stations in the United States, largely centered in the midwest with a cluster in New York state...
. This agreement gave Malara Broadcasting $48.5 million and a revolving credit
Revolving credit
Revolving credit is a type of credit that does not have a fixed number of payments, in contrast to installment credit. Examples of revolving credits used by consumers include credit cards. Corporate revolving credit facilities are typically used to provide liquidity for a company's day-to-day...
line of $5 million, which it used to purchase KDLH
KDLH
KDLH is the CBS-affiliated television station for the Iron Range area of Northeastern Minnesota that is licensed to Duluth. It broadcasts a high definition digital signal on UHF channel 33 from a transmitter west of downtown in Hilltop Park. Owned by the Malara Broadcast Group, the station is...
(from former owner New Vision Television
New Vision Television
New Vision Television is a broadcast company based in Los Angeles, California. The company owns or manages 18 television stations in medium sized markets.-New Vision I:...
) and WPTA
WPTA
WPTA is the ABC-affiliated television station for Northeastern Indiana licensed to Fort Wayne. It broadcasts a high definition digital signal on UHF channel 24 from a transmitter at its studios on Butler Road. The station can also be seen on Comcast and Frontier FiOS channel 7...
, from Granite. In addition to this agreement, Malara also entered into a second agreement with Granite, under which Granite would operate, promote, and sell advertising for the two Malara stations. This is known as a local marketing agreement
Local marketing agreement
In U.S. and Canadian broadcasting, a local marketing agreement is an agreement in which one company agrees to operate a radio or television station owned by another licensee...
.
The future of Malara Broadcasting may be in doubt given several recent occurrences stemming from the death of group founder Tony Malara from leukemia
Leukemia
Leukemia or leukaemia is a type of cancer of the blood or bone marrow characterized by an abnormal increase of immature white blood cells called "blasts". Leukemia is a broad term covering a spectrum of diseases...
and a heart attack on August 24, 2006, as well as financial woes of partner Granite Broadcasting which filed for Chapter 11 bankruptcy
Chapter 11, Title 11, United States Code
Chapter 11 is a chapter of the United States Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business, whether organized as a corporation or sole proprietorship, and to individuals, although it is most...
on December 11, 2006. Both the future of the Granite group and any rulings on who would get control of Malara could lead to massive changes with the company. Granite emerged from bankruptcy in mid-2007 under the control of the Connecticut
Connecticut
Connecticut is a state in the New England region of the northeastern United States. It is bordered by Rhode Island to the east, Massachusetts to the north, and the state of New York to the west and the south .Connecticut is named for the Connecticut River, the major U.S. river that approximately...
-based private equity firm Silver Point Capital, who also controls Communications Corporation of America
Communications Corporation of America
Communications Corporation of America is a broadcasting company in the United States that owns television stations in smaller markets. The company is headquartered in Lafayette, Louisiana...
, White Knight Broadcasting
White Knight Broadcasting
White Knight Broadcasting is a company based in Lafayette, Louisiana. It is a shell company for the Communications Corporation of America , owning seven ComCorp-controlled stations, all based in Louisiana, Texas, and Mississippi...
and selected Spanish-language stations acquired from Equity Media Holdings.
Malara Broadcasting files its financial results to the SEC
United States Securities and Exchange Commission
The U.S. Securities and Exchange Commission is a federal agency which holds primary responsibility for enforcing the federal securities laws and regulating the securities industry, the nation's stock and options exchanges, and other electronic securities markets in the United States...
jointly with Granite, leading many to believe that it is simply a shell corporation for Granite. If this is true, Granite and Malara would be in violation of the FCC's rules on duopolies
Duopoly (broadcasting)
In United States broadcast television and radio, duopoly is a term used to describe a single company which owns two or more stations in the same city or community....
. FCC regulations do not allow duopolies between two of the four highest-rated stations in a market. Additionally, neither Fort Wayne and Duluth have enough full-power stations to legally permit a duopoly in any case. Fort Wayne and Duluth have only six full-power stations each, and FCC regulations require a market to have eight unique station owners once a duopoly is formed--effectively restricting duopolies to markets with at least nine full-power stations. Similar allegations surround Cunningham Broadcasting
Cunningham Broadcasting
Cunningham Broadcasting Corporation is an owner of television stations in the United States. The company currently owns six stations—four affiliated with Fox Broadcasting Company , one affiliated with MyNetworkTV and one affiliated with The CW Television Network.Cunningham has very close ties to...
, which many believe is simply a shell for Sinclair Broadcast Group
Sinclair Broadcast Group
The Sinclair Broadcast Group is an American telecommunications company that operates the largest number of local television stations in the United States. Headquartered in Hunt Valley, Maryland, it owns a total of 57 stations across the country in 35 primarily small and medium markets, many of...
.