Sinclair Broadcast Group Close To Acquiring TV Giant Tribune Media

Instead of 20th Century Fox as speculated, it is Sinclair Broadcast Group that plans to purchase TV giant Tribune Media. However, negotiations are still ongoing. If the deal would push through, the 42 stations would bring to 173 the total number of stations that Sinclair would own.

However, Engadget notes that if Sinclair Broadcast Group would own 173 stations, it would place a lot of TV under one banner, raising concerns about too much dependence on only a few sources of news. However, it adds that Federal Communications Commission Chairman Ajit Pai is rethinking rules that stop companies from owning stations that serve over 39 percent of US homes with TV which would make a buyout a likely scenario.

The FCC just voted to overturn a 2016 rule that limits the number of TV stations that broadcasters could purchase. But analysts point out that if the $4-billion merger between Sinclair Broadcast Group and Tribune Media would push through, it would still exceed the 39 percent cap and possibly face some regulatory changes that may require some divestiture,  Reuters reports.

At the Milken Institute Global Conference, Peter Rice, chairman of Fox Networks Group, said last week that Fox was initially interested in purchasing Tribune Media. Nextstar Media is also interested in Tribune Media. But Fox did not submit a bid, while the offer of Sinclair Broadcast Group for Tribune Media is around $44 per share. It is a premium of close to 30 percent of Tribune Media share prices.

The ongoing Sinclair Broadcast Group-Tribune Media buyout talks could lead to more consolidations in the TV business. Since a lot of customers are canceling their subscriptions to TV service providers, many media companies would go into consolidation for these companies to stay alive. But consumers now have lesser choices in the dwindling field of businesses that can buy.