Nexstar to buy Tribune Media

DFW-area company to buy Chicago-based broadcaster for record price

(Editor’s Note: This post has been updated with new information.)

Nexstar Broadcasting is purchasing Chicago-based Tribune Media for $4.1 billion or $46.50 a share, making them the country’s largest broadcaster. The bid is larger than the one Sinclair made for Tribune in May 2017 before the FCC derailed the deal due to deceptive practices. Nexstar apparently outbid a host of suitors, including Entertainment Studios head Byron Allen, Apollo Global Management, Ion Media, and Hicks Equity Partners.

The move comes as broadcasters across the country are merging in the name of scale to compete with the growing likes of streaming services such as Netflix and Amazon amid rapidly declining ratings – especially in the key 18-49 and 25-54 demos. Broadcasters are also scaling up in order to gain leverage in negotiations over cable and satellite companies when it comes to carrying their broadcast signals. At least one carrier (Dish) is already pushing back, recently taking issues with Tegna and Univision, the latter remaining off Dish systems in a contract dispute.

Tribune Media owns independent WGN-TV, CLTV, and WGN-AM here in Chicago, and CW affiliates WPIX in New York and KTLA in Los Angeles. Nexstar would also own CW affiliate KDAF in Dallas-Fort Worth, where the company is based (in Irving TX, the former home of the Dallas Cowboys.) Nexstar’s largest station is in San Francisco with KRON (an NBC affiliate until 2002) and owns several stations in Illinois, including dominant CBS affiliate WCIA in Champaign-Springfield-Decatur market and Fox affiliate WQRF in Rockford, who operates ABC affiliate WTVO under a shared services agreement with Mission Broadcasting.

Tribune also owns cable network WGN America and a stake in the Food Network.

Nexstar was formed in 1996 and bought its first station, CBS affiliate WYOU in Wilkes-Barre/Scranton, Pa. From there, the company grew rapidly, owning more than 150 television stations nationwide, including the $4.6 billion purchase of the Media General group in 2015. With the Tribune purchase, Nexstar would own stations in eight of the top ten markets but would have to divest some stations: Nexstar plans to spin-off thirteen of the fifteen stations where it would overlap with Tribune, including those in Salt Lake City, Indianapolis, and Portland, Ore.

Even though Nexstar has a much lower profile than Sinclair and is less controversial, the deal is expected to be challenged by several parties due to consolidation issues. Dish, cable operators, and advocacy groups such as Public Knowledge who opposed the Sinclair-Tribune deal are also expected to oppose this deal on similar grounds. Unlike Sinclair however, Nexstar is not known to push any agenda onto its local news stations.

Last month, Tribune Media started offering buyouts to employees, including those at WGN-TV and WGN Radio. WGN-TV carries local sports and produces 70.5 hours of news a week. It also has several local shows in production, including Man Of The People with morning sports anchor Pat Tomasulo. What happens to all of this under Nexstar remains to be seen given the broadcaster is known to run a tight financial ship. It remains to seen if Nexstar would sell WGN-AM, though a host of suitors would come if the radio station is put up for sale.

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