continuing coverage Sinclair and Tribune Part 2: The Redux

[dman748 1250]

They also pulled off some shenanigans in Brimingham and Charlotte that still passed FCC muster, it being their fourth or fifth attempt at a divestiture plan.

Correct me if I'm wrong but the divestiture of KPLR plus whatever else Sinclair must divest before getting an OK from the DOJ will be their 5th attempt at a divestment plan

[CircleSeven 1944]

They also pulled off some shenanigans in Brimingham and Charlotte that still passed FCC muster, it being their fourth or fifth attempt at a divestiture plan.

Charleston, SC.

[Samantha 2878]

Tribune isn't going to terminate the deal, not when they stand to lose ... what ... $500M as a breakup fee to Sinclair?

 

That being said, assuming this deal somehow just falls apart, watch as Tribune PE investor Starboard will let other companies pick the company apart so as to reclaim that lost breakup fee. That includes Fox. No one else is going to be brazen enough to buy the company outright if Sinclair inexplicably can't get it.

 

"Shareholder value" is a strange concept...

[Rusty Muck 4164]

This is really quite the soap opera. Sinclair is so desperate to hang on to everything - they spent many months insisting nothing would be divested and we will win everything. By contrast, in the Gray-Raycom deal, they instantly announced the stations they were getting rid (and probably had that in mind when they were talking). Huge difference in behavior.

You can't deny that Sinclair's obvious ethical issues** and lack of any transparency has played an obvious effect in both Graycom and Disney-Fox. Divestiture requests by the DOJ were immediately agreed to in both of those transactions, and they appear to be on the "fast track" now.

 

I still see Sinclair-Tribune as ultimately going through, but the time spent in trying to consummate the deal, coupled with Sinclair's inherent gift of attracting horrendous PR, will make it a long procress, just barely squeaking by the outside date (assuming it's not extended).

 

And David Smith can't blame anyone for the length of time spent on this but himself; after all, this FCC has done everything possible to help him with this deal, and it's still in limbo. Sure, he can blame Democrats, and he most likely will, but they have no realistic political power whatsoever to stop the deal.

 

**Not necessarily to be confused with their want to have politically-charged/Republican-friendly newscasts throughout their entire chain of stations, that's their prerogative. It's just that they have absolutely no clue how to execute that concept. Quite frankly, the company as a whole has issues that go well beyond a political viewpoint.

[DENDude 184]

Maybe it's just me, but I was surprised that smaller media companies like Hubbard, or/ Evening Post Industries didn't try getting some of the divested stations from Sinclair, to grow there footprint.

[NEOMatrix 1295]

If they had been transparent enough and tried to make some obvious divestitures (KIAH, KDAF, and WUCW to Tegna, WPHL to Fox, etc.) and not put foots in their mouths, then this deal would’ve been approved much faster. Hell, Nexstar made some divestitures and didn’t play the shell game when trying to acquire Media General. That’s why Gray already made plans to unload some conflict stations when they announced a merger with Raycom.

[Samantha 2878]

If they had been transparent enough and tried to make some obvious divestitures (KIAH, KDAF, and WUCW to Tegna, WPHL to Fox, etc.) and not put foots in their mouths, then this deal would’ve been approved much faster. Hell, Nexstar made some divestitures and didn’t play the shell game when trying to acquire Media General. That’s why Gray already made plans to unload some conflict stations when they announced a merger with Raycom.

 

And instead, here we are because they have had to go looking again for a new buyer for KPLR. I never thought I'd see the day where KPLR would be the holdup to a massive nationwide deal. Every day that Sinclair can't find a buyer for it is a day closer to the end date and next month's UHF discount ruling.

[tyrannical bastard 3444]

And instead, here we are because they have had to go looking again for a new buyer for KPLR. I never thought I'd see the day where KPLR would be the holdup to a massive nationwide deal. Every day that Sinclair can't find a buyer for it is a day closer to the end date and next month's UHF discount ruling.

 

You would have thought they would have ditched KDNL by now....

[dman748 1250]

And instead, here we are because they have had to go looking again for a new buyer for KPLR. I never thought I'd see the day where KPLR would be the holdup to a massive nationwide deal. Every day that Sinclair can't find a buyer for it is a day closer to the end date and next month's UHF discount ruling.

 

You would have thought they would have ditched KDNL by now....

Right now, I think Sinclair is still negotiating with whoever the buyer is for KPLR, you would think the negotiations would be done by now but of course Sinclair is taking their sweet time with their negotiations but give it another few weeks to a month and it should be done.

 

I'm pretty sure that Mr. Ripley is aware of the end date and the UHF Discount Ruiling (if not, then Chris Ripley is an idiot)

[Samantha 2878]

Right now, I think Sinclair is still negotiating with whoever the buyer is for KPLR, you would think the negotiations would be done by now but of course Sinclair is taking their sweet time with their negotiations but give it another few weeks to a month and it should be done.

 

I'm pretty sure that Mr. Ripley is aware of the end date and the UHF Discount Ruiling (if not, then Chris Ripley is an idiot)

 

Not just that, but consider the elements that come after the KPLR deal is squared away.

 

That is the final holdup for DOJ approval, so we're still tied up in the Hart-Scott-Rodino phase. After that, Sinclair will present all of the divestitures to the FCC, and the FCC will open another public comment phase for the final deal.

[Eat News 4738]

 

**Not necessarily to be confused with their want to have politically-charged/Republican-friendly newscasts throughout their entire chain of stations, that's their prerogative. It's just that they have absolutely no clue how to execute that concept. Quite frankly, the company as a whole has issues that go well beyond a political viewpoint.

 

No secret that I support the right to do as they see...

 

But they get an "F" for execution of the conservative viewpoint.

 

So I guess I need to thank God that I don't have a local Sinclair outlet to torment me.

 

Myself, and my lizard / reptile friends don't see Sinclair being any kind of "voice of the movement"...unless we are talking bowel movements...

 

No "Rally Around Sinclair" party tonight .

[dman748 1250]

Not just that, but consider the elements that come after the KPLR deal is squared away.

 

That is the final holdup for DOJ approval, so we're still tied up in the Hart-Scott-Rodino phase. After that, Sinclair will present all of the divestitures to the FCC, and the FCC will open another public comment phase for the final deal.

So the DOJ only wants KPLR divested before the DOJ can give the Sinclair purchase of Tribune an ok? What about the Cunningham/Howard Stirk/WGN shelling? Is the DOJ concerned over that? Or how about a potential KTVI/KDNL combinations and maintaining the status quo on WXIN/WTTV? Is the DOJ ok with all of that stuff except KPLR?

[Samantha 2878]

So the DOJ only wants KPLR divested before the DOJ can give the Sinclair purchase of Tribune an ok? What about the Cunningham/Howard Stirk/WGN shelling? Is the DOJ concerned over that? Or how about a potential KTVI/KDNL combinations and maintaining the status quo on WXIN/WTTV? Is the DOJ ok with all of that stuff except KPLR?

 

What happens in this phase comes down to one question. Does the Department of Justice believe that the reduction in competition creates antitrust concerns, particularly in terms of advertising rates? A KMOV/KPLR combo elicited their attention. The DOJ analysis is a separate beast from ownership rules governed by the FCC — it is approval under the Hart-Scott-Rodino Act dealing with antitrust matters. HSR approval happens outside of broadcasting as well, and mergers in other industries also face DOJ second requests from time to time.

 

For instance, it was the DOJ, worried that a potential KMOV/KSDK combo would hold too much ad rate power/ad revenue share in the St. Louis TV market, who forced Gannett to enter into a consent decree to sell KMOV (to Meredith).

 

———

 

Speaking of which, there was actually news today in this acquisition. Sinclair and Tribune jointly filed a response to the various petitions to deny, as well as an opposition to the motion to hold the proceeding in abeyance.

[dman748 1250]

What happens in this phase comes down to one question. Does the Department of Justice believe that the reduction in competition creates antitrust concerns, particularly in terms of advertising rates? A KMOV/KPLR combo elicited their attention. The DOJ analysis is a separate beast from ownership rules governed by the FCC — it is approval under the Hart-Scott-Rodino Act dealing with antitrust matters. HSR approval happens outside of broadcasting as well, and mergers in other industries also face DOJ second requests from time to time.

 

For instance, it was the DOJ, worried that a potential KMOV/KSDK combo would hold too much ad rate power/ad revenue share in the St. Louis TV market, who forced Gannett to enter into a consent decree to sell KMOV (to Meredith).

 

———

 

Speaking of which, there was actually news today in this acquisition. Sinclair and Tribune jointly filed a response to the various petitions to deny, as well as an opposition to the motion to hold the proceeding in abeyance.

Basically they found everything (including triopolies) except for a KMOV/KPLR combo in compliance with the HSR correct?

[Samantha 2878]

Basically they found everything (including triopolies) except for a KMOV/KPLR combo in compliance with the HSR correct?

 

Yeah, it looks like the other divestitures satisfied the Department of Justice.

[Rusty Muck 4164]

You would have thought they would have ditched KDNL by now....

Two possible explanations for why they didn't:

 

1.) Sinclair doesn't want to see KDNL wind up in the hands of someone who would pour money and resources into the station, making them look bad for their 17 years of neglect.

2.) Sinclair wanted to spin off KDNL, but the directives from the DOJ basically told them that KPLR needs to be sold instead, no ifs, ands or buts.

[Rusty Muck 4164]

The problem Sinclair has with KPLR may be much worse than we think it is.

 

Basically, they need to find a buyer that can run it as a standalone. But that means the buyer needs to invest far, far more than the purchase price just to make it a viable operation, and that's not even considering the loss of a news operation that is merged into KTVI (and would become part of KDNL) and takes up quite a bit of programming real estate.

 

That no buyer has emerged for KPLR at this point ... if they haven't now, they won't when the outside date shot clock runs out next month.

[dman748 1250]

The problem Sinclair has with KPLR may be much worse than we think it is.

 

Basically, they need to find a buyer that can run it as a standalone. But that means the buyer needs to invest far, far more than the purchase price just to make it a viable operation, and that's not even considering the loss of a news operation that is merged into KTVI (and would become part of KDNL) and takes up quite a bit of programming real estate.

 

That no buyer has emerged for KPLR at this point ... if they haven't now, they won't when the outside date shot clock runs out next month.

Another thing to note here is this, whoever the buyer is for KPLR will have to have KSDK or KMOV temporarily produce a newscast for KPLR until they can reestablish their in-house news department

 

Beyond that KPLR will be looking for a new building because KDNL will most likely relocate to KTVI's facilities after the sale, they could use the current facilities of KDNL (another option would be to use the facilities of the PBS member station KETC) as a temporary facility in the St. Louis area until they can find a new, permanent home for KPLR.

 

Lots of options for whoever the buyer is for KPLR at this point

[Rusty Muck 4164]

Another thing to note here is this, whoever the buyer is for KPLR will have to have KSDK or KMOV temporarily produce a newscast for KPLR until they can reestablish their in-house news department

 

That is likely not going to happen. It wouldn't be worth having either station extend themselves significantly to cover for a station that's been stripped of their newscasts (and is not even a big-four affiliate, but a CW affiliate that had to have newscasts at irregular time slots to compliment KTVI).

 

Obviously KMOV was going to expand their news department to fill the losses on KPLR, but since Meredith was told no by the DOJ on purchasing the station, they are not going to do any of that now, especially for a limited timeframe.

 

Beyond that KPLR will be looking for a new building because KDNL will most likely relocate to KTVI's facilities after the sale, they could use the current facilities of KDNL (another option would be to use the facilities of the PBS member station KETC) as a temporary facility in the St. Louis area until they can find a new, permanent home for KPLR.

 

Lots of options for whoever the buyer is for KPLR at this point

Again, it goes back to this question: is having to sink a LOT of money beyond whatever KPLR is commanding in the market worth the return on investment?

 

If there was a buyer for KPLR, it would have been revealed already. Sinclair has been trying to do everything possible to speed up the consummation of the Tribune merger, and that the fate of KPLR is languishing like this is a giant red flag.

[dman748 1250]

Again, it goes back to this question: is having to sink a LOT of money beyond whatever KPLR is commanding in the market worth the return on investment?

 

If there was a buyer for KPLR, it would have been revealed already. Sinclair has been trying to do everything possible to speed up the consummation of the Tribune merger, and that the fate of KPLR is languishing like this is a giant red flag.

And Sinclair has nowhere to go because if I'm not mistaken they tried to sell KDNL only to be told that KPLR (and not KDNL) had to go

[Rusty Muck 4164]

And Sinclair has nowhere to go because if I'm not mistaken they tried to sell KDNL only to be told that KPLR (and not KDNL) had to go

It's increasingly looking like the only out for Sinclair is to sell both KTVI and KPLR to Fox and simply retain KDNL, else the whole merger collapses right before their eyes.

 

Just imagine how embarrassing that outcome would be for David Smith.

[dman748 1250]

It's increasingly looking like the only out for Sinclair is to sell both KTVI and KPLR to Fox and simply retain KDNL, else the whole merger collapses right before their eyes.

 

Just imagine how embarrassing that outcome would be for David Smith.

Could Sinclair sell KTVI and KPLR separately? And does Sinclair have an option to retain KDNL/KPLR and sell KTVI off? Because KTVI would be just fine without a duopoly and Sinclair would have a MUCH better time finding a buyer for KTVI than they are with KPLR because KTVI wouldn't lose their news department (unlike KPLR who would become part of KDNL/KTVI after KPLR is sold)

[Rusty Muck 4164]

Could Sinclair sell KTVI and KPLR separately? And does Sinclair have an option to retain KDNL/KPLR and sell KTVI off? Because KTVI would be just fine without a duopoly and Sinclair would have a MUCH better time finding a buyer for KTVI than they are with KPLR because KTVI wouldn't lose their news department (unlike KPLR who would become part of KDNL/KTVI after KPLR is sold)

Here's the problem with that: because KPLR's news department is, for all intents and purposes, a part of KTVI, that would leave Sinclair with two stations in St. Louis with no news department, including a big-four affiliate that's been the laughingstock of the industry for the past 15 years.

[dman748 1250]

Here's the problem with that: because KPLR's news department is, for all intents and purposes, a part of KTVI, that would leave Sinclair with two stations in St. Louis with no news department, including a big-four affiliate that's been the laughingstock of the industry for the past 15 years.

So pretty much Sinclair has nowhere to go except just follow what the DOJ is telling them and find a buyer for KPLR

[Samantha 2878]

Could Sinclair sell KTVI and KPLR separately? And does Sinclair have an option to retain KDNL/KPLR and sell KTVI off? Because KTVI would be just fine without a duopoly and Sinclair would have a MUCH better time finding a buyer for KTVI than they are with KPLR because KTVI wouldn't lose their news department (unlike KPLR who would become part of KDNL/KTVI after KPLR is sold)

 

I mean, Sinclair has been known to propose license swap shenanigans in the past.

 

One iteration of the Allbritton deal contemplated moving WHTM to WHP's transmission facilities and vice versa, then selling WHP (on the WHTM license). Ultimately, Sinclair engaged in a like-kind exchange with Media General (in the midst of swallowing LIN at the time) in which they traded WJAR for WTTA, probably WHTM, and KXRM.

 

That was before enough pressure, mostly DOJ if I recall correctly, prompted them to simply sell WHTM whole.