Following an FCC statement of “serious concerns” over the Sinclair Broadcast Group/Tribune Media merger, both company stocks -- and other TV station groups -- witnessed sharp declines.
Tribune Media stock caved over 13% to $33.74 on early Monday morning trading, with Sinclair losing nearly 4.6% to $31.35. In May 2017, Sinclair announced a $3.9 billion deal for Tribune Media.
Ajit Pai, chairman of Federal Communications Commission, issued statement focusing on Sinclair efforts to sell TV stations to meet current FCC guidelines in order for the deal to proceed.
TV station groups are limited to owning stations representing 39% of U.S. TV homes.
“I have serious concerns about the Sinclair/Tribune transaction,” said 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.”
Other big independent TV stations also registered lower share prices: Nexstar Media Group sinking 2.6% to $80.35; Tegna losing 5.4% to $11.31 and Gray Televison, off 2.1% to $15.33.