Tribune pulls plug on $3.9B buyout by Sinclair

Tribune Media terminates deal to be bought by Sinclair

By one estimate, the combined company would have owned stations in almost 3 out of 4 USA households, controlling an enormous amount of the content Americans see on local stations.

Tribune Media Co. announced Thursday morning that it terminated its controversial $3.9 billion merger with Sinclair Broadcast Group, citing regulatory hurdles.

"In an effort to maintain control over stations it was obligated to sell, Sinclair engaged in unnecessarily aggressive and protracted negotiations with the Department of Justice and the Federal Communications Commission. over regulatory requirements, refused to sell stations in the markets as required to obtain approval, and proposed aggressive divestment structures and related-party sales that were either rejected outright or posed a high risk of rejection and delay - all in derogation of Sinclair's contractual obligations", Tribune said in announcing the suit.

The breakup of the deal is a stinging defeat for Sinclair (SBGI), owner of dozens of local television stations.

In July, the bid by Sinclair, a media outlet that had the vocal support of President Trump, appeared to be cruising toward approval by U.S. regulators.

Tribune has been considering its options since the Federal Communications Commission voted last month to send Sinclair's application to a review by an administrative law judge, a move that typically signals the end of such mergers.

That drew a rebuke from Trump.

Sinclair, which owns 192 stations, said in May 2017 that it planned to acquire Chicago-based Tribune's 42 TV stations in 33 markets. It would have been able to expand rapidly into numerous new markets with the Tribune acquisition. It's also suing Sinclair for breach of contract.

Sinclair was admonished by media watchdogs in April after dozens of Sinclair news anchors read an identical script expressing concern about "one-sided news stories plaguing the country".

Pai´s statement raising questions about whether Sinclair would continue to control some of the stations it proposes to divest followed similar questions raised in separate filings by the American Civil Liberties Union and conservative news outlet Newsmax Media.

"We unequivocally stand by our position that we did not mislead the FCC with respect to the transaction or act in any way other than with complete candor and transparency", said CEO Chris Ripley.

Public Knowledge, an advocacy group that has been critical of the FCC under Pai, has been against a tie up between Sinclair and Tribune from the start. "It is especially great news for those consumers served by smaller video providers that have been victimized in the past by outrageous retransmission consent fee hikes and scurrilous signal blackouts by large corporate broadcasters". "This deal would have contributed to the trend where "local" news and "local" programming is created or scripted out of town".

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