The FCC’s media bureau approved Nexstar’s $6.2 billion acquisition of Tegna, just one day after attorneys general from eight states called upon the DOJ and the FCC to halt the “illegal” merger.
FCC chairman Brendan Carr and President Donald Trump both previously expressed support for the deal, which would require the elimination of the 39% national TV ownership cap put in place by Congress in 2004 to ensure viewpoint diversity and prevent monopolization.
Nexstar’s founder and CEO Perry Sook thanked President Trump and Chairman Carr for passing the merger.
“This transaction is essential to sustaining strong local journalism in the communities we serve,” Sook said in a statement Thursday. “By bringing these two outstanding companies together, Nexstar will be a stronger, more dynamic enterprise—better positioned to deliver exceptional journalism and local programming with enhanced assets, capabilities and talent. We are grateful to President Trump, Chairman Carr and the DOJ for recognizing the dynamic forces shaping the media landscape and enabling this transaction to move forward.”
Upon closing the deal, Nexstar will have 265 television stations in 44 states and the District of Columbia, representing 80% of U.S. television households, adding Big-4 affiliate stations in Phoenix, Atlanta, Toledo, Portland and Maine. The combined company would also have stations in nine of the top 10 markets, and in 41 of the top 50.
Together, Nexstar and Tegna have combined net revenue of $8.1 billion and adjusted EBITDA before stock-based compensation of $2.56 billion, excluding synergies.
The FCC chairman said that the decision was made to empower broadcast TV stations and foster local journalism.
“The FCC has been focused on empowering broadcast TV stations to serve their local communities, consistent with their public interest obligations. Today’s agency decision does exactly that as both the record and Nexstar’s enforceable commitments demonstrate,” Brendan Carr, chairman of the FCC, said. “If you care about local news, you should care about the future of local broadcast TV stations. Often, they are the ones in a market doing the gumshoe reporting that citizens value and need.”
“By approving this transaction, which allows Nexstar to own less than 15% of television stations, the FCC acts mindful of the media marketplace that exists today—not the one from decades past—and the agency ensures that these broadcasters have the resources to continue investing in their local news operations,” he added.
Attorneys general from California, New York, Colorado, Illinois, Oregon, North Carolina, Connecticut and Virginia all filed lawsuits Wednesday in an effort to block the merger, warning that, if approved, the merger would promote less competition and less checks on power.
“This merger would cause incredibly high levels of concentration in local TV markets and is expected to raise cable and satellite prices across the country, causing irreparable harm to local news and consumers who rely on their reporting as a critical source of information,” California AG Rob Bonta said. “If approved, this multibillion-dollar deal would combine the nation’s largest and third-largest television-station conglomerates, creating a behemoth covering 80% of U.S. television households. This merger is illegal, plain and simple, running contrary to federal antitrust laws that protect consumers.”
DirecTV also filed an antitrust lawsuit Thursday, stating that the potential acquisition would be a concentration of broadcast media without precedent. The suit specifically noted that the merger will “irreparably drive up consumer costs, reduce local competition [and] shutter local newsrooms.”
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