Federal Communications Commission Chairman Ajit Pai has issued a statement announcing circulation of a draft hearing designation order regarding the Sinclair/Tribune transaction paving the way for a judicial hearing.
“Based on a thorough review of the record, I have serious concerns about the Sinclair/Tribune transaction,” stated Pai. “The evidence we’ve received suggests that certain station divestitures that have been proposed to the FCC would allow Sinclair to control those stations in practice, even if not in name, in violation of the law. When the FCC confronts disputed issues like these, the Communications Act does not allow it to approve a transaction. Instead, the law requires the FCC to designate the transaction for a hearing in order to get to the bottom of those disputed issues. For these reasons, I have shared with my colleagues a draft order that would designate issues involving certain proposed divestitures for a hearing in front of an administrative law judge,” he advised.
The pair announced in May 2017 that they had entered into a definitive agreement under which Sinclair will acquire 100 per cent of the issued and outstanding shares of Tribune for $43.50 per share, for an aggregate purchase price of approximately $3.9 billion, plus the assumption of approximately $2.7 billion in net debt.
In order to comply with FCC ownership requirements and antitrust regulations, Sinclair said at the time that it may sell certain stations in markets where it currently owns stations. Such divestitures would be determined through the regulatory approval process.