Sinclair Broadcast has revised its plans for TV station sales in three markets in an effort to quell recent pushback from FCC Chairman Ajit Pai over the broadcast giant’s proposed merger with Tribune Media.
Earlier in the week Pai released a statement expressing “serious concerns” over the $3.9 billion deal, specifically regarding certain TV station divestiture plans that “would allow Sinclair to control those stations in practice, even if not in name, in violation of the law.”
Sinclair has strongly denied any misrepresentation of its Tribune acquisition, but is changing its divestiture plan to address any legal concerns and potentially save the deal.
The new plan calls for stations in Dallas (KDAF-TV) and Houston (KIAH-TV) to be put into a divesture trust and sold to a third-party by an independent trustee after the Tribune deal closes, rather than be sold to Cunningham Broadcasting. Sinclair also proposes acquiring Tribune’s WGN-TV in Chicago as part of the larger transaction, rather than selling it off – a move Sinclair said “is, and has always been, fully permissible under the national ownership cap.”
Neither Sinclair nor Tribune have seen the draft order circulated by Pai to refer the transactions to a judge for an administrative review hearing, but the Sinclair said press reports have indicated those three stations are the divestitures drawing FCC concern.
Whether Sinclair’s latest move will be enough to stave off a lengthy administrative review is unclear, but a final order had not been issued as of Wednesday.
On Monday FCC Commissioner Michael O’Rielly said he was inclined to support Pai’s draft order, as long as it includes “sufficient and defined timelines,” for the commission’s Administrative Law Judge to conduct and process a hearing.
“The FCC’s reported concerns with sales to certain parties have been eliminated in light of the withdrawals of the applications relating to Dallas, Houston and Chicago,” Sinclair said in a statement. “Accordingly, we call upon the FCC to approve the modified Tribune acquisition in order to bring closure to this extraordinarily drawn-out process and to provide certainty to the thousands of Tribune employees who are looking for closure.”
The Sinclair-Tribune deal has garnered strong criticism and opposition since the agreement was announced last year, as Sinclair stands to own more than 200 TV stations post-merger, making it the nation’s largest station owner.