Tribune calls off $3.9B buyout by Sinclair

  • Tribune calls off $3.9B buyout by Sinclair

Tribune calls off $3.9B buyout by Sinclair

Separately, on Tuesday, Democratic members of Congress asked the FCC to investigate reports that "Sinclair Broadcasting illegally exercised control over the advertising activities of Tribune Media Company".

Tribune Media Company is ending its troubled merger deal with Sinclair Broadcast Group, less than a month after federal regulators cited "serious concerns" about the plan.

Sinclair Broadcast Group Inc. had been attempting to buy the Chicago company's 42 TV stations and had agreed to get rid of stations in some markets to gain regulatory approval. "This uncertainty and delay would be detrimental to our company and our shareholders. and, by way of our lawsuit, intend to hold Sinclair accountable".

Tribune, which is on the hook for a $135million breakup fee, filed a lawsuit against Sinclair, the largest U.S. broadcast station owner, alleging material breach of contract 15 months after the merger was first announced.

Reporters at stations owned by Sinclair - which include almost 200 local affiliate news channels across the country branded as ABC, CBS, NBC, Fox, and more - have been forced to run segments that attack Democratic politicians, discredit the FBI's investigation of Russian Federation, call other media outlets "false news", and even run a regular commentary show by a former Trump adviser.

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.

Tribune has filed a lawsuit against Sinclair for breach of contract. It also follows a significant blow from the Republican-led Federal Communications Commission last month, when it questioned Sinclair's candor over the planned sale of some stations. Here, the WGN Radio sign appears on the side of Tribune Tower in downtown Chicago.

The company is "open to all opportunities" in terms of industry consolidation or remaining independent, Tribune Media Chief Executive Officer Peter Kern told investors on a call on Thursday. The FCC declined to comment on Thursday.

"We think that it is likely that another suitor will emerge for Tribune in the near-term", Kenneth Duffel, an analyst with KDP Investment Advisors, said in a note.

The Maryland company said Thursday in a prepared statement that the Tribune lawsuit is "entirely without merit".

Sinclair also refused to sell certain stations that would have helped the deal secure regulatory approval, Tribune claims.

Sinclair already has 173 stations around the country, including KENV in Salt Lake City, KOMO in Seattle and WKRC in Cincinnati.

He said the merger's failure was not the result of "an unwelcoming regulatory environment" but how Sinclair moved forward.

Under the terms of the deal, Tribune and Sinclair had the right to call off the merger without paying a termination fee if it was not completed by August 8.

A survey by the Washington Post in December 2016 showed that the coverage by Sinclair-run news outlets was "disproportionately" favorable to Trump in the election year.