Sinclair Revises Divestiture Plan to Save Tribune Merger, Denies Misleading FCC

Sinclair Broadcast Group has vowed to revise its station divestiture plan in an effort to salvage its $3.9 billion acquisition of Tribune Media.

Sinclair, in a lengthy statement issued Wednesday, has also strongly denied any effort to mislead the FCC. The company it was “shocked” earlier this week when FCC chairman Ajit Pai raised concerns about the legality of its plan to maintain operational control of the stations by selling them to entities with ties to Sinclair.

The revised plan calls for Sinclair to acquire Tribune’s WGN-TV Chicago as part of the larger transaction. Sinclair is proposing that Tribune-owned stations in Dallas (KDAF-TV) and Houston (KIAH-TV) will be put into a divestiture trust and sold in an arm’s length transaction by an independent trustee after the Tribune sale is closed.

Sinclair said its conversations with “sources at the FCC” indicated those three stations were the focus of Pai’s concern. On Monday, Pai began the process of sending Sinclair’s divestiture plan to a judge for an administrative review hearing. That promised to prolong the regulatory review process of the merger agreement struck in May 2017. It’s unclear if Sinclair’s latest proposal will clear the path for a sign-off on the deal by the FCC and Justice Department.

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