INNOVATE Announces Closing of the Sale of a Controlling Interest in its Broadcasting Segment to CONX

INNOVATE (VATE) has closed the sale of a controlling interest in its Broadcasting segment holding company, HC2 Broadcasting Holdings, to CONX Corp., following a refinancing completed on June 1, 2026.

Rhea-AI Summary

INNOVATE (VATE) has closed the sale of a controlling interest in its Broadcasting segment holding company, HC2 Broadcasting Holdings, to CONX Corp., following a refinancing completed on June 1, 2026.

CONX now holds a 75% ownership interest in HC2, while INNOVATE retains 25%, subject to potential reduction due to post-closing purchase price adjustments and certain expense and indemnification obligations. As part of the transaction, CONX committed to fund up to $75 million of equity into HC2, a portion at closing and the remainder after closing, also subject to potential reduction. The previously announced $105 million loan entered in connection with the refinancing, together with accrued interest, was extinguished in accordance with the transaction agreements, which the company says strengthens its balance sheet and capital structure. For 18 months after closing, INNOVATE may buy up to an additional 15% ownership interest in HC2 from CONX, while for two years from May 29, 2026, a CONX affiliate holds an option to increase its HC2 stake up to 80.1%.

Positive

• CONX assumes control of HC2 with up to $75 million equity funding commitment
• Broadcasting segment’s $105 million refinancing loan plus accrued interest extinguished
• INNOVATE retains a 25% ownership stake in HC2 with potential to increase by up to 15%
• HC2 controls more than 260 TV stations and over 50 networks across 40+ states

Negative

• INNOVATE will not receive cash proceeds from this transaction unless the CONX affiliate exercises its option
• INNOVATE’s retained 25% HC2 stake is subject to potential reduction from purchase price adjustments and obligations
• INNOVATE cedes control of its Broadcasting segment, with CONX now holding a 75% interest

News Explained

Although the broadcasting transaction has closed, INNOVATE receives no cash proceeds from it unless CONX’s affiliate exercises its option to acquire additional ownership, so the current closing does not itself provide sale cash to INNOVATE.

Market Context

VATE's prior close was $7.19 on Sep 1, 2026. Against that baseline, the completed HC2 transaction tr...

Analysis

VATE's prior close was $7.19 on Sep 1, 2026. Against that baseline, the completed HC2 transaction transferred control while preserving a minority stake; the effective $100 million S-3/A and contingent cash proceeds remained important watchpoints.

Key Figures

CONX ownership: 75% INNOVATE ownership: 25% Committed HC2 equity: $75 million +5 more

8 metrics

CONX ownership 75% Following transaction closing

INNOVATE ownership 25% Retained HC2 interest, subject to potential reduction

Committed HC2 equity $75 million CONX commitment; portion funded at closing

Extinguished loan $105 million Previously announced refinancing loan, plus accrued interest

Additional ownership option 15% INNOVATE option during 18-month post-closing period

Affiliate ownership option 80.1% Option exercisable during two years from May 29, 2026

Broadcast television stations More than 260 HC2 and subsidiaries portfolio

Broadcast networks Over 50 Distributed across more than 40 states

Historical Context

5 past events · Latest: Aug 18 (Positive)

Pattern 5 events

Date	Event	Sentiment	24h Move	Catalyst
Aug 18	Medical technology nomination	Positive	+1.4%	MediBeacon system received a 2026 Prix Galien USA medical technology nomination.
Aug 10	DBM Global sale	Positive	-41.1%	INNOVATE agreed to sell its DBM Global stake for $650 million.
Aug 10	DBM Global acquisition	Positive	-41.1%	IES Holdings announced its agreement to acquire DBM Global from INNOVATE.
Aug 06	Second-quarter earnings	Positive	+63.4%	Quarterly revenue, net income, EPS and Adjusted EBITDA improved year over year.
Aug 03	Earnings date announcement	Neutral	+6.8%	The company scheduled its second-quarter results release and conference call.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

VATE's recent news responses were mixed, with positive announcements producing both strong gains and a sharp decline.

Key Terms

controlling interest, refinancing, fully diluted basis, indemnification obligations

4 terms

controlling interest financial

"CONX acquired a controlling interest in HC2"

A controlling interest is when a person or group owns enough shares of a company to influence or make decisions about how it is run. It’s similar to having a majority of votes in a group project, giving you the power to guide decisions. For investors, holding a controlling interest means they can significantly affect the company’s direction and policies.

refinancing financial

"The transaction follows the completion of the Broadcasting segment’s refinancing"

Refinancing is the process of replacing an existing loan with a new one that has different terms—such as a lower interest rate, longer repayment period, or different payment schedule—much like trading in a high-interest mortgage for a cheaper one. Investors care because refinancing changes a company’s interest costs and cash flow, which can boost profits or free money for growth, but it can also signal stress or add fees that affect returns.

fully diluted basis financial

"INNOVATE retains the option to acquire up to an additional 15% ownership interest"

A fully diluted basis counts every share that could exist if all outstanding options, warrants, convertible securities and other rights were exercised or converted into common stock, showing the maximum number of shares outstanding. For investors this matters because it spreads ownership and earnings across that larger share count, like slicing a pie into every possible piece before deciding how big each investor’s slice will be, which affects per-share value and ownership percentage.

indemnification obligations regulatory

"subject to potential reduction for post-closing purchase price adjustments and certain expense"

A company's indemnification obligations are promises it has made to cover certain losses, legal costs, or damages that another party might suffer because of the company’s actions or events tied to a deal. Think of it like a guarantee or built-in insurance: if something goes wrong, the company must step in and pay. For investors this matters because these potential payouts create contingent liabilities that can reduce cash, raise legal exposure, and affect a company’s value and risk profile.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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NEW YORK, Sept. 02, 2026 (GLOBE NEWSWIRE) -- INNOVATE CORP.® (NYSE: VATE) (“INNOVATE” or the “Company”) announced today the successful closing of the previously announced transaction between INNOVATE and CONX Corp. (“CONX”), pursuant to which CONX acquired a controlling interest in HC2 Broadcasting Holdings Inc. (“HC2”), a holding company for INNOVATE’s Broadcasting segment. The transaction follows the completion of the Broadcasting segment’s refinancing announced on June 1, 2026.

CONX has acquired a controlling interest in HC2 and now holds a 75% ownership interest in HC2, while INNOVATE retains a 25% ownership interest, subject to potential reduction in connection with post-closing purchase price adjustments and certain expense and indemnification obligations.

“We are pleased to successfully complete this transaction and further strengthen INNOVATE’s balance sheet and capital structure,” said Paul Voigt, Interim CEO of INNOVATE. “HC2 has built a leading portfolio of television broadcast assets across the United States, and this transaction positions the HC2 business for its next phase of growth while allowing INNOVATE to retain meaningful participation in its future success through our continuing ownership stake.”

HC2 and its subsidiaries have assembled one of the nation’s largest portfolios of Class A and low-power television stations, operating more than 260 broadcast television stations and distributing over 50 broadcast networks across more than 40 states.

As part of the transaction, CONX has committed to fund up to $75 million of equity into HC2, a portion of which was funded at closing and the balance of which is payable following closing subject to potential reduction for post-closing purchase price adjustments and certain expense and indemnification obligations. Additionally, the previously announced $105 million loan agreement entered in connection with the refinancing transaction, together with accrued interest, was extinguished in accordance with the terms of the transaction agreements.

For an 18-month period following the closing, INNOVATE retains the option to acquire up to an additional 15% ownership interest in HC2, on a fully diluted basis, from CONX pursuant to the terms of the transaction agreements.

For a two-year period from May 29, 2026, an affiliate of CONX (the “CONX Affiliate”) retains the option to acquire up to 80.1% of the equity interests of HC2 on a fully-diluted basis. If the CONX Affiliate exercises such option, the CONX Affiliate would first acquire all of the equity interests of HC2 held by CONX, together with an additional amount of equity interests from INNOVATE necessary to reach the 80.1% threshold, subject to INNOVATE’s right to require the CONX Affiliate to instead acquire all of INNOVATE’s remaining equity interests in HC2. INNOVATE will not receive any cash proceeds from the transaction unless the CONX Affiliate exercises this option.

“We appreciate the efforts of everyone involved in bringing this transaction to completion,” added Voigt. “We believe HC2 is well-positioned to capitalize on future opportunities in the evolving broadcast and communications landscape.”

About INNOVATE

INNOVATE is a portfolio of best-in-class assets in three key areas of the new economy – Infrastructure, Life Sciences and Spectrum. Dedicated to stakeholder capitalism, INNOVATE employs approximately 3,700 people across its subsidiaries. For more information, please visit: http://www.innovatecorp.com.

About HC2

HC2 and its subsidiaries strategically acquire and operate over-the-air broadcasting stations across the United States.

About CONX CORP.

CONX is a diversified operating entity seeking opportunities to power the next generation of innovators in communications and connectivity. CONX’s mission is to partner with emerging companies with quality management and strong and differentiated business models with the ability to scale quickly.

Advisors

Cleary Gottlieb Steen & Hamilton LLP is serving as legal advisor to the Company. Dundon Advisers LLC is serving as financial advisor to the Company.

Forward-Looking Statements

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements generally relate to future events, including statements regarding the anticipated benefits of the merger to INNOVATE and its stockholders; potential adjustments to ownership interests in HC2; INNOVATE’s potential exercise of the option to acquire additional ownership in HC2, or the option granted to an affiliate of CONX to acquire additional ownership; future funding of equity commitments by CONX in favor of HC2; the future business, operations, and prospects of HC2 following the merger; and INNOVATE’s strategies with respect to its capital structure. You are cautioned that such statements are not guarantees of future performance and that INNOVATE’s actual results may differ materially from those set forth in the forward-looking statements. All of these forward-looking statements are subject to risks and uncertainties that may change at any time. Factors that could cause INNOVATE’s actual expectations to differ materially from these forward-looking statements include, but are not limited to (i) the risk that the anticipated benefits of the merger are not realized; (ii) litigation; (iii) the Company’s ability to exercise the option on favorable terms or at all; (iv) the effect of the completion of the merger on INNOVATE’s or HC2’s business; (v) macroeconomic conditions; and (vi) the other factors under the heading “Risk Factors” set forth in INNOVATE’s Annual Report on Form 10-K and in INNOVATE’s Prospectus Supplement dated August 10, 2026, which is available on INNOVATE’s website or at www.sec.gov. You should not place undue reliance on these forward-looking statements, which are made only as of the date of this press release. INNOVATE undertakes no obligation to publicly update or revise forward-looking statements to reflect subsequent developments, events, or circumstances, except as may be required under applicable securities laws.

INNOVATE Investor Contact:
Solebury Strategic Communications
Anthony Rozmus
(212) 235-2691
Email: ir@innovatecorp.com

FAQ

What transaction did INNOVATE (VATE) complete with CONX regarding its broadcasting segment?

INNOVATE closed the sale of a controlling interest in HC2 Broadcasting Holdings, its Broadcasting segment holding company, to CONX. CONX now owns 75% of HC2, while INNOVATE retains a 25% minority interest, subject to potential post-closing adjustments and obligations.

What are the post-transaction ownership stakes in HC2 for CONX and INNOVATE (VATE)?

After the transaction, CONX holds a 75% ownership interest in HC2, and INNOVATE retains 25%. INNOVATE’s stake may be reduced by post-closing purchase price adjustments and certain expense and indemnification obligations under the transaction agreements.

How much equity funding has CONX committed to provide to HC2 in the INNOVATE (VATE) deal?

CONX has committed to fund up to $75 million of equity into HC2. A portion of this amount was provided at closing, with the remaining balance payable after closing, subject to possible reduction for purchase price adjustments and certain expenses and indemnification obligations.

What happened to the $105 million refinancing loan in INNOVATE’s (VATE) broadcasting transaction?

The previously announced $105 million loan agreement related to the Broadcasting segment’s refinancing, together with accrued interest, was extinguished as part of the transaction agreements. The company states that completing this transaction further strengthens its balance sheet and capital structure.

Does INNOVATE (VATE) receive cash proceeds from selling control of HC2 to CONX?

INNOVATE will not receive any cash proceeds from the sale of the controlling interest in HC2 at closing. It will only receive cash if the CONX affiliate exercises its option to acquire up to 80.1% of HC2’s equity interests on a fully diluted basis.

What option does INNOVATE (VATE) have to increase its ownership in HC2 after the CONX deal?

For 18 months after closing, INNOVATE has the option to acquire up to an additional 15% ownership interest in HC2, on a fully diluted basis, from CONX. This could allow INNOVATE to increase its minority stake if it chooses under the transaction terms.

What option does the CONX affiliate have to further increase its stake in HC2 after buying control from INNOVATE (VATE)?

For two years from May 29, 2026, a CONX affiliate may acquire up to 80.1% of HC2’s equity interests on a fully diluted basis. It would first buy all HC2 equity held by CONX and then acquire additional equity from INNOVATE, which can instead require a sale of all its remaining HC2 interests.