Published: Thu, August 09, 2018
Entertaiment | By Mabel Barber

Tribune Breaks Off $3.9B Sinclair Merger, Sues Sinclair

Tribune Breaks Off $3.9B Sinclair Merger, Sues Sinclair

Last month, the Federal Communications Commission voiced concerns that Sinclair may have attempted to skirt ownership rules, and ordered the potential transaction to go through an administrative hearing. Sinclair already own 39% of the TV stations in the USA, and this would have raised that to 42%.

"In light of (the FCC order), this transaction can not be completed within an acceptable time frame, if ever", Kern said.

Tribune Media highlighted those divestitures - which reportedly would have involved selling stations to companies with close ties to the Smith family - in a statement on Thursday, saying Sinclair "engaged in unnecessarily aggressive and protracted negotiations" with both the FCC and the Justice Department.

Sinclair raised hackles in March when it had all the anchors of its daily news shows across the country recite the exact same script, which adopted the tone and rhetoric of Trump, accusing other media outlets of spreading "biased and false news". The commissioners called into question whether some of Sinclair's proposed divestments were a "sham" because they were being sold to people so closely aligned with Sinclair and in agreements that would still allow Sinclair to operate the stations.

In the merger agreement, Sinclair committed to use its reasonable best efforts to obtain regulatory approval as promptly as possible, including agreeing in advance to divest stations in certain markets as necessary or advisable for regulatory approval. Sinclair was to have acquired Tribune for a hefty $3.9 billion price tag - in a move that would have added dozens of local stations to the roughly 200 which are already in its portfolio.

Analysts expect Tribune to seek another buyer.

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It appeared for many months that the Trump Administration and its appointed FFC Chairman Ajit Pai were predisposed to support the proposed Sinclair acquisition, and related TV station divestures, despite opposition arguing that the combination would give Sinclair unprecedented control over the nation's TV outlets.

Sinclair did not immediately respond to requests for comment.

Sinclair, a Maryland-based company which is the largest owner of local news stations in the US, is notorious for its right-wing, pro-Trump slant, and its unusual system of distributing slanted "must-run" content to its local stations to work into their broadcasts.

The American Cable Association (ACA), which represents small- and medium-sized cable companies, also cheered Tribune's decision.

Pai suddenly announced last month that he had "serious concerns" about the deal because Sinclair's divesture plan would still leave it effectively in control of TV stations in markets where its ownership exceeded FCC limitations, including in Chicago.

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