Emmis wants to keep both stations
By Andrew Gomes
Advertiser Staff Writer
The owner of Honolulu television stations KHON and KGMB informed the Federal Communications Commission yesterday that it will seek to keep both stations pending an upcoming agency review of the rule prohibiting its ownership of the two.
The notification comes 19 months after Indianapolis-based Emmis Communications Corp. acquired KGMB as part of a multi-station purchase in October 2000. Emmis had been ordered to sell either KGMB, the local CBS affiliate, or KHON, the local Fox affiliate, because federal rules prohibit one company from controlling two of the top four television stations in a single market.
Emmis has received two extensions of an initial six-month ownership waiver, and in February asked the FCC for an additional year to make a sale because of what the company said was difficulty attracting a satisfactory offer.
The FCC responded that Emmis knew it might have to sell one of the stations in a depressed market, and granted a three-month extension that expires at the end of June. The agency also demanded information from Emmis describing the company's efforts to find a buyer.
In Emmis' filing yesterday, the company described its sale efforts and said it would continue them, but also said that within seven days it plans to file a request to stay the sale requirement until the so-called duopoly rule is either affirmed or relaxed at an FCC rule review later this year.
The company cited two February rulings by the U.S. Court of Appeals for the District of Columbia circuit — one that instructed the FCC to reconsider the duopoly rule, and one that imposed standards for retaining rules.
Emmis said the rulings "in our view create the most serious doubt as to whether the (duopoly) rule can be sustained."
FCC officials could not be reached late yesterday. Emmis said it would not comment further on its filings with the agency.
In its description of sale efforts to the FCC, Emmis said a media broker had contacted 36 potential buyers, including three companies with hotel or real estate interests in Hawai'i.
The 36 contacts, Emmis said, resulted in only five serious expressions of interest that mostly constituted offers of about $20 million. Citing a "significant" loss at that price, Emmis rejected the offers.
None of the potential buyers was identified, although the Hawai'i hotel or real estate owners were not among those making tentative offers. Emmis said one of those offers is still being negotiated.
Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.
