Sinclair defends takeover of Tribune Media in FCC response

Sinclair Broadcast Group Inc. has declined to offer a list of TV stations it plans to sell or is marketing for sale in a response to federal regulators’ request for information about the broadcaster’s proposed $3.9 billion takeover of Tribune Media Co.

But the Hunt Valley-based TV station owner would need to sell licenses in at least two markets under current national TV station ownership limits, the company said in a document filed late Thursday with the Federal Communications Commissions.

The FCC asked Sinclair last month to show how it plans to comply with ownership limits after it buys Tribune. The deal, announced in May, would create the nation’s largest broadcaster, with 233 television stations that reach 72 percent of U.S. households.

Tribune Media was formed in 2014 when Tribune Co., then the parent of The Baltimore Sun, split its broadcasting and publishing divisions into separate, independent companies. The broadcast division became Tribune Media, while the publishing division, including The Sun, became Tribune Publishing, renamed tronc Inc. last year.

In its response, Sinclair said it has not identified specific sales. But it hired TV station broker Moelis &Company in July to help it identify potential buyers.

“Moelis has contacted a substantial number of potential buyers, consisting of both broadcasters and financial investor/management teams, many of which have signed non-disclosure agreements,” Sinclair said in its filing. “The outcomes of negotiations with potential buyers could impact the license divestitures Sinclair would make.”

The U.S. Department of Justice also is reviewing the proposed deal and is expected to complete that by the end of the year. Because the Justice Department could require specific divestitures of TV stations, it’s premature for Sinclair to finalize divestiture plans before then, the company said.

Approval of the acquisition has appeared likely because the FCC recently relaxed rules for broadcast station ownership. The proposal has generated opposition from groups such as Dish Network LLC, the American Cable Association, Free Press, Public Knowledge and Common Cause. Opponents say the deal will hurt media competition and consumers.

Sinclair has said the scale and efficiencies that will come from the merger will ensure the future of free over-the-air-televison.

Sinclair’s response Thursday also addressed the FCC’s request for more detail on how the merged company would improve service to the public. Sinclair said it would make a multimillion-dollar investment in the newly acquired Tribune stations, allowing for more hours of local news programming.

The company said it invested almost $40 million in stations it acquired from Fisher Communications Inc. and Allbritton Communications, purchasing new computers and laptops, trucks and other news vehicles, camera equipment, video-encoders, weather systems and other news studio and production equipment.

“The economies of scale Sinclair enjoys allow it to make improvements that smaller-station group owners cannot afford,” Sinclair said.

It also plans to produce more original content shows, share programs, add reporters to local political beats and beef up its investigative teams and online presence, the filing said. It pointed out that in San Antonio, where Sinclair owns two stations in a single market, the broadcaster has created two different newscasts using one newsroom and boosted ratings at each of the stations.

Sinclair grew out of WBFF Fox 45 in Baltimore.

lorraine.mirabella@baltsun.com

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