Sinclair, national player in the U.S. local TV market, revealed plans to acquire rival E.W. Scripps, according to an SEC filing released Monday, reports Deadline.
In the filing, the company noted that it has accumulated 8% of Scripps Class A shares in the public market at a cost of $15.6 million, adding that a deal could be negotiated and implemented in nine to 12 months, per Deadline.
At a market value of $277 million, Scripps operates 60 local stations in 40 markets, making it the ninth-largest local operator in the nation according to rankings from industry trade group BIA. According to Deadline, the company also owns national networks Ion, Court TV, Bounce, and Grit, and is notable for its annual spelling bee, which notched its 100th year last summer. Ion is also a rightsholder of the WNBA, as well as other women’s sports.
Mirroring another recent takeover bid by local TV operator Nexstar to acquire Tegna at $6.2 billion pricetage, Sinclair’s bid would require a change in federal rules limiting station ownership. The FCC currently prohibits ownership of stations that reach 39% of U.S. households, though Donald Trump’s appointed chair of the commission, Brendan Carr, has argued for lifting the cap, according to Deadline.
Station operators say that they face a double standard, as massive tech conglomerates encounter no such limitations when it comes to their American media presence. However, critics of station consolidation say that large operators will monopolize the market, limiting the spectrum of viewpoints and the opportunity for debate. Ultimately, they say per Deadline, the number of stations will dwindle in a similar fashion to the newspaper and radio industries.
Even if the regulatory agency followed through on a rule-change, some say this could not be done without Congressional authority. According to Deadline, Anna Gomez, the only democrat on the FCC, said the agency does not have the authority to change ownership rules unilaterally.
According to Sinclair’s filing, the merger “would be structured to require no external financing as the combined company would maintain each company’s respective debt and preferred capital structures. As a result, the transaction would avoid significant refinancing costs while meaningfully reducing the Issuer’s leverage through the realization of synergies and lowering future refinancing risk,” per Deadline.
The company, like rival Nexstar, is promoting the tie-up as a way of preserving its “vital public service role in producing local news.” Both companies attracted attention earlier this year when they pulled Jimmy Kimmel’s Live! from their networks, precipitating brief showdown when ABC suspended the host after his remarks regarding the assassination of conservative activist Charlie Kirk.
Pointing to “intensifying competition” in the local TV space, Sinclair argued via Deadline that “further scale in the broadcast television industry is essential to address secular headwinds and compete effectively with larger-scale big-tech and big-media players, as well as major broadcast groups.”