The soon-to-be-slimmer 21st Century Fox is set to acquire about 10 local TV stations from Sinclair Broadcast Group as the latter moves closer to government approval of its acquisition of Tribune Media.
A report in the Financial Times about the brewing deal cited three unidentified sources but did not identify the price.
Sinclair, already the No. 1 station group, is poised to grow substantially larger once it swallows up Tribune. The deal has generated controversy on the way through the regulatory process in Washington, for a range of reasons. Rumors have swirled for weeks about Sinclair needing to shed some station assets in order to get the final OK on Tribune.
As a company with strong ties to President Donald Trump, Sinclair has been seen to be making an end-run around the usual merger review process. A Federal Communications Commission led by a Trump-appointed majority has made a series of moves that ease the path for the deal, and is currently reviewing the longstanding 39% cap on station ownership — the Tribune portfolio would give Sinclair penetration into a remarkable 72% of U.S. households. Once unthinkable, such a high number may be attainable once certain assets are shed. Thus, the talks with Fox.
The FCC has mentioned January 17 as a self-generated deadline for completing its review, according to a report by Bloomberg. It is co-ordinating its efforts with the Department of Justice, an agency that has been in the spotlight of late for filing a lawsuit to block the AT&T-Time Warner merger. That case is set to go to trial in March.
Sinclair executives met with the FCC on January 4, according to a notice about the meeting. The parties “discussed the general status of Sinclair’s divestiture plan and Sinclair’s communications with the Department of Justice,” the notice said.
From Fox’s end, the reasons to buy stations are clear. With the $66B sale of most of the company’s assets to Disney, Rupert Murdoch will be left with the Fox broadcast network, Fox News and the station portfolio, which is No. 1 in the country in terms of revenue. As an owner of expensive NFL rights, Fox can wring more revenue from football if it owns more stations.
Fox and Sinclair declined comment to the FT. The companies have not immediately responded to Deadline’s requests for comment.