Raycom likely buyer of Lincoln TV assets -sources

By Megan Davies and Michael Flaherty

NEW YORK (Reuters) - Privately held Raycom Media appears close to buying the television assets of insurance and investment firm Lincoln National Corp., two sources familiar with the situation told Reuters.

Philadelphia-based Lincoln said in June it would explore strategic options for its Lincoln Financial Media unit, which owns and operates three television stations in the U.S. Southeast including North Carolina, 18 radio stations and a sports syndication and production business.

The unit as a whole is valued at around $1.2 billion, one of the sources estimated, broken down to around $650 million for radio, $500 million for TV and $50 million for the syndication.

Sources said Raycom was willing to pay around 13 to 14 times cash flow for the assets, higher than broadcast peers which one analyst said trade at around 10 to 13 times.

Private equity firm Oak Hill Partners was involved in the auction, but was not willing to pay the price Raycom appears willing to pay, sources said. Oak Hill bought the New York Times' broadcast unit in May for $3.3 billion.

It was uncertain whether Raycom's pending deal included the sports business, a TV production company involved in the broadcast of college football and basketball throughout the U.S. Southeast.

In addition, the sale of Lincoln's radio assets was unclear, as parties were only interested in buying separate stations rather than the asset as a whole, and bids were thought to be at a disappointing price, one of the sources said.

But Raycom is in pursuit of the Lincoln T.V. group, sources say. Montgomery, Alabama-based Raycom, which owns or operates 42 television stations in 18 states, did not return numerous calls made over a period of three days to various executives.