Mid-day Wednesday stock price of Tribune Media soared 7% to $37.06, while Sinclair Broadcast Group tallied a 4% gain to $41.45. The report came from Reuters.
A major part of the deal comes with the expectation that the Federal Communications Commission will be relaxing rules for TV station ownership. Currently, TV station groups are allowed to own TV stations, which collectively can reach 39% of U.S. TV homes.
Sinclair is estimated to be at 39%, with Tribune slightly above it at 44%, according to one media analyst estimate. Tribune Media has 42 broadcast stations reaching 50 million U.S. TV homes. Sinclair owns 173 television stations in 81 markets.
Tribune owns the WGN America cable channel. Sinclair owns sports cable network Tennis Channel.
Recently, Tribune Media President/Chief Executive Officer Peter Liguori announced that he would be leaving the company. Tribune also recently sold off its entertainment metadata company Gracenote to for $560 million in cash to Nielsen. The sale was completed in January.
Also on Wednesday, Tribune Media issued its quarterly earnings report. Operating revenue grew 11% to $529.6 million. Net income was $19.0 million, compared to a net loss of $380.9 million in the fourth quarter of 2015.
Tribune’s Television and Entertainment net advertising revenues -- which include political and digital revenues -- gained 10% to $384.6 million for the fourth quarter.
Political advertising revenues had a $68.3 million increase in the quarter, while retrans fees grew 20% to $89.2 million; carriage fees (for WGN) gained 35% to $30.7 million for the fourth quarter and digital ad revenue climbed 7% to $18.9 million.