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UPDATED to include background and comment: FCC chairman Ajit Pai issued a statement today raising “serious concerns” about Sinclair Broadcast Group’s proposed $3.9 billion acquisition of Tribune Media. At issue are Sinclair’s plans to divest some stations to meet ownership limits in a way that would allow Sinclair to retain control of them “in practice, if not in name, in violation of the law,” Pai noted.
RelatedSinclair Again Defends Merit Of Tribune Media Acquisition: 'The Sky Is Not Falling'
Pai - Commissioners - Deal - Hearing - Law
Pai said he had asked fellow commissioners to vote to send the deal to a hearing before an administrative law judge, implying months of delay, if not derailing the deal.
“Based on a thorough review of the record, I have serious concerns about the Sinclair/Tribune transaction,” Pai said in a statement issued this morning.
Sinclair - Stock - % - Morning - Trading
Sinclair’s stock fell nearly 6% in morning trading to $31 a share, off from the opening price of $32.95. Tribune Media’s shares fell off even more dramatically, dropping 15% to $32.60 this morning, down from $38.56 at the start of the trading day.
For a while, the transaction seemed likely to win regulatory approval easily. The FCC, under the Trump administration, relaxed or eliminated a number of rules governing broadcasters, including one that limits station ownership.
Clouds - February - Justice - Department - Division
Clouds began to gather in February, when the Justice Department’s antitrust division was locked in a battle with Sinclair over how many stations it would need to sell to gain the deal’s approval.
Meanwhile, the office of FCC inspector general began investigating whether Pai and his aides had improperly pushed for the rule changes following their extensive contact with Sinclair executives that was detailed in a New York Times investigation.
FCC - Commissioner - Jessica - Rosenworcel - Pai
FCC commissioner Jessica Rosenworcel applauded Pai’s decision.
Sinclair said in April that it would divest 23 television stations to win approval, but noted...
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