For Sale - KRON-TV Channel 4, $800 Million, Fixer-Upper

Apparently not even Dr. Phil can help KRON-TV (Channel 4). More than a year has passed since the financially ailing station's owner, New York–based Young Broadcasting, announced plans to revolutionize local TV news by turning its on-air reporters into camera-toting video journalists. The on-air news talent left in droves.

Then, after hooking up with the fledgling MyNetworkTV, the station tried — without success — to air the English-language equivalent of Spanish-language telenovelas in prime time. Trying to lift its fortunes, management even resorted to a numerologist's advice and added a few high-energy numbers to KRON's Van Ness Avenue address.

Now, however, Young Broadcasting appears ready to give up on the venerable San Francisco station, whose fortunes plummeted after it was dumped as an NBC affiliate not long after Young bought it in 2000. Young has hired an investment bank to shop around the station in a market that analysts say may be unforgiving, considering the record sum — $825 million — that the company paid for it.

Largely owing to the KRON purchase, from which it has never recovered, Young Broadcasting is drowning in more than $800 million of debt amid slumping revenues, records on file with the Securities and Exchange Commission show. Its stock, which fetched $65 a share shortly after the KRON acquisition, now trades for less than $1 on the NASDAQ exchange, and has dipped as low as 37 cents.

Among the likely candidates rumored to want KRON is the FOX network, which does not own a TV station in the Bay Area, and whose affiliation with KTVU (Channel 2) in Oakland expires in a few years; and NBC, which had wanted KRON before buying KNTV (Channel 11) in San Jose, and which some analysts speculate might be interested in acquiring a second Bay Area property.

Jim Morgan, Young Broadcasting's chief financial officer, acknowledges that there is interest in the station. "We're comfortable with selling the station at this time, in this environment," he says, while declining to identify potentially interested parties.

"It's like beachfront property in a sense," says Edward Atorino, a media analyst with the Benchmark Company, an investment bank. "It's not often that a television station in a market like the Bay Area becomes available, and so you can be sure that folks are lined up to see what they can acquire it for."

If the station does change hands, its fortunes may have nowhere else to go but up, considering the series of miscues that has afflicted it since Young Broadcasting acquired it. One of KRON's biggest mistakes was anchoring its prime-time schedule around the syndicated Dr. Phil show at 8 p.m. According to recent financial disclosures, in the last two years Young has written off more than $8 million in losses associated with the Dr. Phil show after its ratings sagged, causing ad revenue to fall far short of what the station had contracted to pay for the show. The company anticipates similar losses until the contract expires in 2011, documents show.

"It's really kind of sad what happened to the station," says freelance documentary maker and former KRON reporter Greg Lyon, who is part of an informal Friends of KRON group that holds an annual picnic and occasional meetings. At one such gathering this month, Lyon says he "sort of expected" that the rumor of KRON's possible sale would dominate the discussion, but was surprised: "There wasn't as much talk about KRON as you'd think. People have moved on."

Sadly, so have the viewers.