Sinclair to Pay $3.9 Billion to Expand Local TV Reach

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The acquisition of Tribune gives Sinclair TV stations in big media markets such as New York, Chicago and Miami, strengthening its hand in negotiations with pay-TV distributors and major broadcast networks. The deal combines two of the largest TV station owners in the U.S. Tribune owns and operates 42 TV stations in 33 markets, along with cable network WGN America and minority stakes in the TV Food Network. The deal was valued at $3.9 billion, plus the assumption of $2.7 billion in debt.

More TV station consolidation may begin under the Trump Administration: Sinclair Broadcast Group has proposed a massive deal to buy Tribune Media for just under $4 billion.

Jessell was part of a conference call with Chris Ripley, CEO of Sinclair, who said there are 14 markets where Tribune has stations that overlap with Sinclair. Under current FCC ownership rules, SINCLAIR will be over the cap limits in SEATTLE, PORTLAND, SALT LAKE CITY, NORFOLK, SCRANTON-WILKES-BARRE (stations operated by SINCLAIR under an LMA), MILWAUKEE, and ST. LOUIS and will gain new duopolies in WASHINGTON, DES MOINES, GRAND RAPIDS, HARRISBURG, and RICHMOND. Should Sinclair's acquisition of Tribune close-and the uncertainty over that issue could persist, as the FCC is still reviewing its ownership policies-the company would equal Salem Media as the most prolific USA corporate player in this space in the past seven-plus years.

On Monday, Sinclair said it will pay about $43.50 in cash and stock for each share of Tribune, an 8 percent premium from Tribune's closing price of $40.29 on Friday.

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The sale is pending approval by the Federal Communications Commission.

Sinclair has promoted conservative leaning programming and there is speculation the company might use its acquisition of the Tribune Media properties as a springboard to create a national network of its own to challenge Fox News.

"This is a pivotal time for broadcast, and we are excited to reach more communities across the United States, as well as better serve our consumers and advertisers with new technologies that will super charge our capabilities", Ripley said. Tribune Media declined to comment. It already owns KMPH-TV, the Fox affiliate in Fresno, and KFRE-TV, the CW affiliate there.

"Today's announcement is the culmination of an extensive strategic review, which has delivered significant value to our stockholders", Tribune CEO Peter Kern said in a press release.