ACQUISITIONS AND DISPOSITION OF ASSETS:

During the years ended December 31, 2016, 2015 and 2014, we acquired certain assets for an aggregate purchase price of $1,872.0 million plus working capital of $56.3 million.

All of these acquisitions provide expansion into additional markets and increases value based on the synergies we can achieve. The following summarizes the material acquisition activity during the years ended December 31, 2016, 2015 and 2014:

2016 Acquisitions

Tennis Channel. In March 2016, we acquired all of the outstanding common stock of Tennis Channel (Tennis), a cable network which includes coverage of the top 100 tennis tournaments and original professional sport and tennis lifestyle shows, for $350.0 million plus a working capital of $9.2 million. This was funded through cash on hand and a draw on the Bank Credit Agreement. The acquisition provides an expansion of our network business and increases value based on the synergies we can achieve. Tennis is reported within Other within Note 13. Segment Data.

The following table summarizes the allocated fair value of acquired assets and assumed liabilities of Tennis (in thousands):



Cash	$	5,111
Accounts receivable	17,629
Prepaid expenses and other current assets	6,518
Property and equipment	5,964
Definite-lived intangible assets	272,686
Indefinite-lived intangible assets	23,400
Other assets	619
Accounts payable and accrued liabilities	(7,414		)
Capital leases	(115		)
Deferred tax liability	(16,991		)
Other long term liabilities	(1,669		)
Fair value of identifiable net assets acquired	305,738
Goodwill	53,427
Total	$	359,165

The allocations presented above are based upon management’s estimate of the fair values using valuation techniques including income, cost and market approaches. In estimating the fair value of the acquired assets and assumed liabilities, the fair value estimates are based on, but not limited to, expected future revenue and cash flows, expected future growth rates, and estimated discount rates. The purchase prices have been allocated to the acquired assets and assumed liabilities based on estimated fair values.

The definite-lived intangible assets of $272.7 million related primarily to customer relationships, which represent existing advertiser relationships and contractual relationships with MVPDs and will be amortized over a weighted average useful life of 15 years. Acquired property and equipment will be depreciated on a straight-line basis over the respective estimated remaining useful lives. Goodwill is calculated as the excess of the consideration transferred over the fair value of the identifiable net assets acquired and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce and noncontractual relationships, as well as expected future synergies. Goodwill will not be deductible for tax purposes.

Other 2016 Acquisitions. During the year ended December 31, 2016, we acquired certain television station related assets for an aggregate purchase price of $72.0 million less working capital of $0.2 million. We also exchanged certain broadcast assets which had a carrying value of $23.8 million with another broadcaster for no cash consideration, and recognized a gain on the derecognition of those broadcast assets of $4.4 million, respectively.

2015 Acquisition

During the year ended December 31, 2015, we acquired one television station for a cash purchase price of $15.5 million, which was financed with cash on hand.

2014 Acquisitions

Allbritton. Effective August 1, 2014, we completed the acquisition of all of the outstanding common stock of Perpetual Corporation and equity interest of Charleston Television, LLC (together the “Allbritton Companies”) for $985.0 million plus working capital of $50.1 million. The Allbritton Companies owned and operated nine television stations in the following seven markets, all of which were affiliated with ABC. Also included in the purchase was NewsChannel 8, a 24-hour cable/satellite news network covering the Washington, D.C. metropolitan area. We financed the total purchase price with proceeds from the issuance of 5.625% senior unsecured notes, a draw on our amended bank credit agreement, and cash on hand. See Note 6. Notes Payable and Commercial Bank Financing.

Concurrent with the acquisition of the Allbritton companies, due to FCC multiple ownership rules, we sold WHTM in Harrisburg/Lancaster/York, PA to Media General in September 2014 for $83.4 million, less working capital of $0.2 million and the non-license assets of WTAT in Charleston, SC to Cunningham for $14.0 million, effective August 1, 2014. WHTM was acquired from the Allbritton companies and assets of WHTM were classified as assets held for sale in the Allbritton purchase price allocation. We did not recognize a gain or loss on this transaction. Prior to the sale of WTAT, we operated the station under an LMA and purchase agreement with Cunningham. This sale was accounted for as a transaction between parties under common control. See Note 11. Related Person Transactions for further discussion.

MEG Stations. Effective December 19, 2014, we completed the acquisition of four television stations in three markets from Media General, Inc (MEG Stations) for a purchase price of $207.5 million less working capital of $1.6 million. We financed the purchase price with cash on hand and borrowing under our revolving credit facility. We financed the purchase price, net of the proceeds received from the sale of those stations, with borrowings under our revolving credit facility.

Simultaneously, in December 2014, we sold to Media General the broadcast assets of two stations for $93.1 million less working capital of $0.6 million, which resulted in a gain on sale of $39.0 million.

KSNV. Effective November 1, 2014, we completed the acquisition of certain of assets of KSNV (NBC) in Las Vegas, NV from Intermountain West Communications Company (Intermountain West) for $118.5 million less working capital of $0.2 million. In conjunction with the purchase, we assumed the rights under the affiliation agreement with NBC and swapped our KVMY call letters for the KSNV call letters. We financed the total purchase price with cash on hand and borrowings under our revolving credit facility.

Other 2014 Acquisitions. During the year ended December 31, 2014, we acquired certain assets related to eight other television stations in four markets. The purchase price for these stations was $123.5 million less working capital of $1.1 million which was financed with cash on hand and borrowings under our revolving credit facility.

The following tables summarize the allocated fair value of acquired assets and assumed liabilities, including the net assets of consolidated VIEs (in thousands):



	MEG Station			KSNV			Allbritton			Other			Total 2014 acquisitions
Accounts receivable	—			—			38,542			—			38,542
Prepaid expenses and other current assets	476			67			19,890			79			20,512
Program contract costs	1,954			482			1,204			2,561			6,201
Property and equipment	23,462			8,300			46,600			8,352			86,714
Indefinite-lived intangible assets	675			—			13,700			225			14,600
Definite-lived intangible assets	125,925			70,375			564,100			87,915			848,315
Other assets	—			—			20,352			1,500			21,852
Assets held for sale	—			—			83,200			—			83,200
Accounts payable and accrued liabilities	(2,085		)	(277		)	(8,351		)	(1,143		)	(11,856		)
Program contracts payable	(1,914		)	(481		)	(1,140		)	(2,554		)	(6,089		)
Deferred tax liabilities	—			—			(261,291		)	—			(261,291		)
Other long term liabilities	—			(1,200		)	(17,263		)	—			(18,463		)
Fair value of identifiable net assets acquired	148,493			77,266			499,543			96,935			822,237
Goodwill	57,398			41,024			535,694			25,501			659,617
Total	$	205,891		$	118,290		$	1,035,237		$	122,436		$	1,481,854

During the year ended December 31, 2015, we made certain measurement period adjustments to the initial purchase accounting for the acquisitions in 2014, resulting in reclassifications between certain noncurrent assets and noncurrent liabilities, including a decrease to property and equipment of approximately $12.5 million, a decrease to broadcast licenses of $3.4 million, an increase to definite-lived intangible assets of $58.3 million, and a decrease to goodwill of $42.2 million, as well as a corresponding decrease to depreciation of $0.7 million and a decrease to amortization of $0.7 million during the year ended December 31, 2015.

The intangible assets will be amortized over the weighted average useful lives of 15 years for network affiliations and 14 years for the customer relationships, which represent existing advertiser relationships and contractual relationships with MVPDs. Acquired property and equipment will be depreciated on a straight-line basis over the respective estimated remaining useful lives. Goodwill is calculated as the excess of the consideration transferred over the fair value of the identifiable net assets acquired and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce and noncontractual relationships, as well as expected future synergies. Other intangible assets will be amortized over the respective weighted average useful lives ranging from 14 to 15 years.

The following tables summarize the amounts allocated to definite-lived intangible assets representing the estimated fair values and estimated goodwill deductible for tax purposes (in thousands):



	MEG Stations		KSNV		Allbritton		Other		Total 2014 acquisitions
Network affiliations	$	56,925	$	44,775	$	356,900	$	27,575	$	486,175
Customer relationships	45,500		25,600		207,200		44,800		323,100
Other intangible assets	23,500		—		—		15,540		39,040
Fair value of identifiable definite-lived intangible assets acquired	$	125,925	$	70,375	$	564,100	$	87,915	$	848,315
Estimated definite-lived intangible assets deductible for tax purposes	$	57,398	$	41,024	—		$	25,501	$	123,923

Financial Results of Acquisitions

The following tables summarize the results of the net media revenues and operating income (loss) included in the financial statements of the Company beginning on the acquisition date of each acquisition as listed below (in thousands):



Revenues	2016		2015		2014
Tennis Channel	$	84,040	$	—	$	—
MEG Stations	86,466		69,275		2,299
KSNV	63,818		32,471		5,972
Allbritton	253,845		231,300		106,258
Other stations acquired in:
2016	49,186		—		—
2015	2,676		1,007		—
2014	49,298		42,470		9,172
Total net media revenues	$	589,329	$	376,523	$	123,701



Operating Income (Loss)	2016			2015		2014
Tennis Channel	$	(1,990	)	$	—	$	—
MEG Stations	26,728			15,246		1,010
KSNV	36,446			7,206		2,108
Allbritton	49,777			39,550		26,914
Other stations acquired in:
2016	18,311			—		—
2015	646			426		—
2014	11,644			8,451		1,569
Total operating income	$	141,562		$	70,879	$	31,601

In connection with the 2016, 2015, and 2014 acquisitions, for the years ended December 31, 2016, 2015, and 2014, we incurred $1.4 million, $0.5 million, and $5.7 million, respectively, of costs primarily related to legal and other professional services, which we expensed as incurred and classified as corporate general and administrative expenses in the consolidated statements of operations.

Pro Forma Information

The following table sets forth unaudited pro forma results of operations, assuming that Tennis and the 2014 Acquisitions, along with transactions necessary to finance the acquisition, occurred at the beginning of the year preceding the year of acquisition. The pro forma results exclude the acquisitions presented under Other 2016 Acquisitions, 2015 Acquisitions, and Other 2014 Acquisitions above, as they were deemed not material both individually and in the aggregate. The 2014 period does not include the pro forma effects of the Tennis acquisition, and as such will not provide comparability to the 2015 and 2016 pro forma periods presented in the following table (in thousands, except per share data):



	Unaudited
	2016		2015		2014
Total revenues	$	2,751,441	$	2,310,202	$	2,150,124
Net Income	$	249,722	$	168,364	$	189,174
Net Income attributable to Sinclair Broadcast Group	$	244,261	$	163,789	$	186,338
Basic earnings per share attributable to Sinclair Broadcast Group	$	2.61	$	1.72	$	1.92
Diluted earnings per share attributable to Sinclair Broadcast Group	$	2.59	$	1.71	$	1.90

This pro forma financial information is based on historical results of operations, adjusted for the allocation of the purchase price and other acquisition accounting adjustments, and is not indicative of what our results would have been had we operated the businesses since the beginning of the annual period presented because the pro forma results do not reflect expected synergies. The pro forma adjustments reflect depreciation expense, amortization of intangibles and amortization of program contract costs related to the fair value adjustments of the assets acquired, additional interest expense related to the financing of the transactions, and exclusion of nonrecurring financing and transaction related costs. Depreciation and amortization expense are higher than amounts recorded in the historical financial statements of the acquirees due to the fair value adjustments recorded for long-lived tangibles and intangible assets in purchase accounting.