The broadcast network was hit with dozens upon layoffs less than a month after Nexstar Media signed a deal to acquire 75% of The CW.
It is not clear how many departures there were, but one person who has been able to estimate it at between 30 and 40. Nexstar is a well-known company for its local stations. However, it also runs NewsNation. It was created after Tribune Media acquired WGN America in 2019. The lower cost profile of news programming, a distinctly different neighborhood from the scripted fare that was briefly WGNA’s specialty, was the driving motivation of the makeover.
The senior leadership team responsible for the CW’s 50-50 joint venture between Warner Bros and CBS (or more recently Warner Bros Discovery, Paramount Global) has departed. Paul Hewitt was the longtime head for corporate communications. He announced his resignation earlier today. Dennis Miller, a former chief of corporate communications and media executive at venture capital firms, has been elected to lead the CW.
Even more than in most M&A deals, it is Nexstar’s mission to aggressively slash operating costs in order to make the deal make sense. Strategically, it fits Nexstar’s nation-leading portfolio of local TV stations, which includes the largest number of CW affiliates controlled by a single owner. But the Texas-based company hasn’t waxed nostalgic for the network’s free-spending Gossip Girl Instead of telegraphing to Wall Street, its investors, that it plans to move forward with a more streamlined operation focusing on unscripted programming and news, heyday instead.
In exchange for 75% ownership of The CW, Nexstar paid no upfront considerations, instead agreeing to take on the network’s debt. During a conference with analysts in August, Nexstar projected that The CW would be profitable by 2025. WBD and Paramount are the remaining shareholders, at 12.5% each.
Lee Ann Gliha, Chief Financial Officer, said that it is “not typical for fully-distributed broadcast or cable networks”to be in the black. She actually stated that, citing SNL Kagan data she claimed that “no other broadcast network operates at an ongoing loss.”
A significant reduction in expenses will be a centerpiece of the new owner’s turnaround plan. “You know us,”Gliha spoke to analysts during the conference call. “We are profit- and cash-flow-focused and expect this asset to achieve profitability.”
Nexstar will report third-quarter earnings in November 8.