Sinclair Broadcast Group plans to purchase Tribune Media Company in a $3.9 billion sale that will add 42 new stations in 33 markets to one of the country’s biggest broadcasters.

Sinclair currently owns 173 television news stations across the country, and the acquisition is the largest in the company’s history.

“This is a transformational acquisition for Sinclair that will open up a myriad of opportunities for the company,” Sinclair President and CEO Chris Ripley said in a statement.

The deal, which still needs approval from the Federal Communication Commission, comes just weeks after the regulatory agency voted to reverse a 2016 decision that limits broadcasters owning stations serving no more than 39 percent of U.S. television households.

Sinclair acknowledged it may have to sell stations in certain markets in order to comply, and expects the deal to close by the end of the fourth quarter of 2017.

Twenty-First Century Fox and Nexstar Media Group had also considered buying Tribune after it put itself on the market more than a year ago.

The FCC’s easing of media ownership rules also opens the doors to more possible broadcast mergers down the line.

Once the deal with Tribune is complete, Sinclair will bring more than 200 TV stations under one roof.

Sinclair currently owns stations affiliated with every major English-language broadcast network, as well as three affiliated with Spanish-language network Univision. The merger with Tribune will add 14 Fox, 12 CW, six CBS, three ABC and two NBC affiliates.

“The Tribune stations are highly complementary to Sinclair’s existing footprint and will create a leading nationwide media platform that includes our country’s largest markets,” Ripley said.

The new broadcast transmission standard will also allow broadcasting to mobile devices, paving the way for new business models.

In addition to enabling Sinclair to build ATSC 3.0 (Next Generation Broadcast Platform), the acquisition will scale emerging networks and national sales, integrate content verticals, and create synergy among operating efficiencies, revenue streams, programming strategies and digital platforms, Ripley said.

“Television broadcasting is even more relevant today, especially when it comes to serving our local communities,” Sinclair Executive Chairman David Smith said in a statement “Tribune’s stations allow Sinclair to strengthen our commitment to serving local communities and to advance the Next Generation Broadcast Platform. This acquisition will be a turning point for Sinclair, allowing us to better serve our viewers and advertisers while creating value for our shareholders.”

The deal values Tribune at $43.50 per share — a more than 26 percent premium over Tribune’s closing share price in February before rumors of the sale. Sinclair will also take on 2.7 billion in debt from Tribune, as shares closed Friday at $40.29. Tribune stockholders will receive $35 in cash and the rest in Sinclair stock at 0.23 per share.

“Today’s announcement is the culmination of an extensive strategic review, which has delivered significant value to our stockholders,” said Tribune CEO Peter Kern in a statement. “Since we announced the strategic review 15 months ago, we have streamlined the business, monetized non-core assets, strengthened our balance sheet and returned more than $800 million to stockholders — all of which has resulted in a 50 percent increase in stockholder value. We are extremely proud to join Sinclair, and we’re excited that Tribune stockholders and employees will have the opportunity to participate in the long-term growth of the combined company.”

READ MORE: Variety, Reuters


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