Sinclair Broadcasting to buy Tribune Media in $4 billion deal, reports say

Sinclair Broadcast Group, the largest U.S. broadcaster, is reportedly close to acquiring Tribune Media Co., in a deal worth about $4 billion.

Headquartered in Baltimore, Md., Sinclair currently owns 173 stations and reaches more than 38% of the nation. The company would pay about $45 a share, or about $4 billion, for Chicago-based Tribune Media, according to Bloomberg, which cited persons familiar with the situation.

Reuters and several other outlets including CNN also reported the development, based on conversations with people familiar with the deal.

If successful, Sinclair would win out over another reported suitor: media giant 21st Century Fox, which The Financial Times reported last week was also in talks with private equity firm Blackstone in a joint bid to acquire Tribune Media.

Tribune Media has 42 stations including WGN and stations in L.A., New York, Chicago and Philadelphia, and reaches more than 43% of the nation (the FCC gave it an exemption in 2013 to buy 19 stations from Local TV LLC). The deal wouldn’t have been feasible until last month’s decision by the Federal Communications Commission to ease limits on TV-station ownership.

Currently, a media company can own multiple TV stations as long as its market share doesn’t exceed 39% nationwide. The FCC’s reversal of a rule about how market reach of UHF channels is calculated could keep the market share of a combined Sinclair and Tribune Media low enough that a deal is workable with some divestitures, according to Bloomberg Intelligence.

Tribune shares closed Friday at $40.29, giving the company a $3.5 billion market cap. Reuters reported that Sinclair is expected to pay $44 a share.

An agreement may be announced as early as Monday, Bloomberg reported, however the deal could still not happen.

Source: USA Today

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