Sinclair Broadcast to buy Tribune Media for about $3.9 billion

Reuters Contributor
Font Size:

By Liana B. Baker and Rishika Sadam

(Reuters) – Sinclair Broadcast Group Inc said on Monday it would buy Tribune Media Co , one of the largest U.S. television station operators, for about $3.9 billion, giving Sinclair a greater foothold in big broadcast markets like New York and Chicago.

Shares of Tribune, which operates 42 U.S. television stations, rose 5.2 percent to $42.42. Sinclair shares fell about 3 percent to $35.90.

A recent U.S. Federal Communications Commission vote to reverse a 2016 decision limiting the number of television stations some broadcasters can buy helped pave the way for the deal.

Sinclair may still have to sell certain stations such as St. Louis and Salt Lake City in order to comply with FCC regulations, Chief Executive Chris Ripley said on a conference call.

The sale will mark the end of a long road for Tribune, whose name was long intertwined with the city of Chicago, where the Chicago Tribune newspaper was founded more than 150 years ago. The company once owned the Chicago Cubs baseball team.

The sale comes after a decade of turmoil for the company, which was acquired by real estate mogul Sam Zell and then by private equity firms. It emerged from bankruptcy in late 2012 and completed a spinoff of its newspaper assets in 2014 into a company now known as Tronc Inc .

Wells Fargo analyst Marci Ryvicker said the deal’s biggest cost savings will come from retransmission fees, which are the payments station groups like Sinclair make to broadcasters such as Fox, CBS and NBC to carry their programming.

Tribune’s portfolio would help expand Sinclair’s already vast network of 173 stations in 81 U.S. markets and marks the largest acquisition for the Baltimore-based company.

Sinclair also gets cable network WGN America and a stake in the Food Network, a joint venture between Tribune and Scripps Network Interactive Inc .

In addition to Sinclair, Twenty-First Century Fox Inc and Nexstar Media Group Inc had considered an acquisition of Tribune, Reuters has reported.

The combined company could have more leverage in negotiations with Fox since it will own a large chunk of Fox broadcast affiliates around the country.

The $43.50 per share offer represents a 26 percent premium over Tribune’s closing price on Feb. 28, a day before Reuters broke the news that Sinclair had approached Tribune about an acquisition.

Tribune stockholders will receive $35 in cash and 0.23 share of Sinclair stock for each Tribune share. Sinclair will assume about $2.7 billion in debt in the deal, which is expected to close in the fourth quarter.

J.P. Morgan advised Sinclair while Moelis & Co and Guggenheim Securities advised Tribune.

(Reporting by Liana Baker in San Francisco and Rishika Sadam in Bengaluru; Additional reporting by Jessica Toonkel; Editing by Leslie Adler)

Reuters

PREMIUM ARTICLE: Subscribe To Keep Reading

Sign up

By subscribing you agree to our Terms of Use

You're signed up!

Sign up

By subscribing you agree to our Terms of Use

You're signed up!
Sign up

By subscribing you agree to our Terms of Use

You're signed up!

Sign up

By subscribing you agree to our Terms of Use

You're signed up!
Sign up

By subscribing you agree to our Terms of Use

You're signed up!

Sign Up

By subscribing you agree to our Terms of Use

You're signed up!
Sign up

By subscribing you agree to our Terms of Use

You're signed up!
Sign up

By subscribing you agree to our Terms of Use

You're signed up!
BENEFITS READERS PASS PATRIOTS FOUNDERS
Daily and Breaking Newsletters
Daily Caller Shows
Ad Free Experience
Exclusive Articles
Custom Newsletters
Editor Daily Rundown
Behind The Scenes Coverage
Award Winning Documentaries
Patriot War Room
Patriot Live Chat
Exclusive Events
Gold Membership Card
Tucker Mug

What does Founders Club include?

Tucker Mug and Membership Card
Founders

Readers,

Instead of sucking up to the political and corporate powers that dominate America, The Daily Caller is fighting for you — our readers. We humbly ask you to consider joining us in this fight.

Now that millions of readers are rejecting the increasingly biased and even corrupt corporate media and joining us daily, there are powerful forces lined up to stop us: the old guard of the news media hopes to marginalize us; the big corporate ad agencies want to deprive us of revenue and put us out of business; senators threaten to have our reporters arrested for asking simple questions; the big tech platforms want to limit our ability to communicate with you; and the political party establishments feel threatened by our independence.

We don't complain -- we can't stand complainers -- but we do call it how we see it. We have a fight on our hands, and it's intense. We need your help to smash through the big tech, big media and big government blockade.

We're the insurgent outsiders for a reason: our deep-dive investigations hold the powerful to account. Our original videos undermine their narratives on a daily basis. Even our insistence on having fun infuriates them -- because we won’t bend the knee to political correctness.

One reason we stand apart is because we are not afraid to say we love America. We love her with every fiber of our being, and we think she's worth saving from today’s craziness.

Help us save her.

A second reason we stand out is the sheer number of honest responsible reporters we have helped train. We have trained so many solid reporters that they now hold prominent positions at publications across the political spectrum. Hear a rare reasonable voice at a place like CNN? There’s a good chance they were trained at Daily Caller. Same goes for the numerous Daily Caller alumni dominating the news coverage at outlets such as Fox News, Newsmax, Daily Wire and many others.

Simply put, America needs solid reporters fighting to tell the truth or we will never have honest elections or a fair system. We are working tirelessly to make that happen and we are making a difference.

Since 2010, The Daily Caller has grown immensely. We're in the halls of Congress. We're in the Oval Office. And we're in up to 20 million homes every single month. That's 20 million Americans like you who are impossible to ignore.

We can overcome the forces lined up against all of us. This is an important mission but we can’t do it unless you — the everyday Americans forgotten by the establishment — have our back.

Please consider becoming a Daily Caller Patriot today, and help us keep doing work that holds politicians, corporations and other leaders accountable. Help us thumb our noses at political correctness. Help us train a new generation of news reporters who will actually tell the truth. And help us remind Americans everywhere that there are millions of us who remain clear-eyed about our country's greatness.

In return for membership, Daily Caller Patriots will be able to read The Daily Caller without any of the ads that we have long used to support our mission. We know the ads drive you crazy. They drive us crazy too. But we need revenue to keep the fight going. If you join us, we will cut out the ads for you and put every Lincoln-headed cent we earn into amplifying our voice, training even more solid reporters, and giving you the ad-free experience and lightning fast website you deserve.

Patriots will also be eligible for Patriots Only content, newsletters, chats and live events with our reporters and editors. It's simple: welcome us into your lives, and we'll welcome you into ours.

We can save America together.

Become a Daily Caller Patriot today.

Signature

Neil Patel