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TV station owner Tribune Media is kicking off a new round of talks to sell itself after its planned $3.9 billion sale to peer Sinclair Broadcast Group failed to get regulatory clearance, people familiar with the matter said on Wednesday. Tribune is working with financial advisers Moelis & Co. and Guggenheim Securities To field interest from potential buyers, including rival Nexstar Media Group and private equity firms, the sources said on Wednesday.
Following the collapsed merger and $1 billion lawsuit Tribune filed against Sinclair, Sinclair filed a countersuit, claiming that “Tribune, through its meritless lawsuit, is seeking to capitalize on an unfavorable and unexpected reaction from the [FCC] to capture a windfall for Tribune.”
Perry Sook’s Nexstar Media Group may be hoping to succeed with Tribune Media where Sinclair Broadcasting failed. The chief executive of the second-largest TV station owner in the country met last week with the Justice Department’s antitrust boss, sources say.
Tribune Media will pay bonuses to executives who worked for more than 15 months on its failed merger with Sinclair Broadcast Group. The bonuses, which were disclosed in a filing on Tuesday, are for the company’s chief financial officer, Chandler Bigelow, as well as its president of broadcast media, Larry Wert, and its general counsel and chief strategy officer, Edward Lazarus.
Following the spectacular collapse of their merger, Tribune and Sinclair have to go back to work. For Tribune, that means putting up the “For Sale” sign again, with plenty of interested buyers out there. For Sinclair, things are ominous. First it must settle Tribune’s billion-dollar lawsuit, and then find a way back into the FCC’s good graces. That could prove costly, too.
Sinclair Broadcast Group’s singularly nasty breakup with Tribune Media on Thursday may put a serious damper on the conservative-leaning broadcast giant’s ability to expand, despite its persisting hunger to do so. Although many suspected Tribune would pull the plug on the merger, few expected it to sue while accusing Sinclair of deception.
The presumption of many is that it is still a seller, but Tribune CEO Peter Kern casts some doubt on that today, telling analysts that company may want to “enhance” its TV station portfolio.
It says Sinclair broke its merger agreement by proposing “extremely risky and highly controversial divestitures to buyers that were specifically disfavored by the FCC staff,” deliberately omitted material facts from FCC applications and generally antagonizing “the regulators at both DOJ and the FCC while seeking their approval.”
At the same time as it ends the $3.9 billion deal, it files a lawsuit seeking compensation “for all losses incurred as a result of Sinclair’s material breaches of the merger agreement.” It also releases its second quarter earnings results that included Television and Entertainment segment revenues of $486.4 million, up 4% from $466.1 million in 2Q 2017.