Nexstar is in some hot water after its merger with Tegna, after receiving lawsuit from Direct TV over antitrust issues, Deadline reports. The merger between Nexstar and Tegna could create a broadcast station giant worth billions.
For those who don’t know, Nexstar is the largest owner of over 200 local television stations. An example would be the CW. As of today, Nexstar is finalizing a $6.2 billion acquisition of Tegna Inc. However, Direct TV has filed an antitrust claim to stave off the transaction.
According to Deadline, Direct TV issued this statement in its lawsuit: “This merger would create a massive concentration of market power. The acquisition would give Nexstar control of 228 broadcast stations reaching 80% of television households in 132 local markets and increase concentration in more than a dozen local markets by more than 10 times the amount that is presumptively unlawful under the antitrust laws. That enormous increase in market power will enable Nexstar to raise prices and reduce the amount, variety, and quality of local news without having to worry about losing business to competition.” The lawsuit also mentioned that merger would result in a reduction in the quality of content that Nexstar sells to Direct TV. However, Direct TV isn’t the only one suing Nexstar, because on late Wednesday, California, New York and six other states filed suit to block the merger and felt compelled to join the litigation.
The FCC had given Nexstar the green light to go through with the merger. According to Deadline, Perry Sook, the CEO of Nexstar, had this to say regarding the transaction: “This transaction is essential to sustaining strong local journalism in the communities we serve. By bringing these two outstanding companies together, Nexstar will be a stronger, more dynamic enterprise—better positioned to deliver exceptional journalism and local programming with enhanced assets, capabilities, and talent.” Nexstar has been given a waiver from an ownership cap, which will limit the companies from amassing stations covering more than 39% of the country.
One thing to take away from all of this is that television will change when it comes to this merger.