May 8, 2017
Sinclair Broadcast Group Inc. has agreed to acquire Tribune Media Co. for approximately $3.9 billion after prevailing in an auction for one of the largest U.S. television station operators.
The deal, which gives Sinclair ownership or control of TV stations in 72 percent of the U.S., is worth $43.50 per share.
"It's transformative for the company and will create a leading media platform that will include the country's largest markets," Chris Ripley, Sinclair's president and CEO, said in an interview. "We think it's a great opportunity to improve the content across all the stations by networking the stations together and news sharing."
Sinclair, one of the largest television station operators in the country, is headquartered in Hunt Valley. It owns WBFF Fox 45, a local CW affiliate and My TV Baltimore.
Tribune Media owns or operates 42 television stations.
"This will give us a huge station footprint, and we can roll out mobile-first advanced services, which will be targeted for personal devices, cell phones and tablets ... and be more like an internet experience," with heavy use of video, Ripley said.
Tribune Media was created in 2014 when Tribune Co., then the parent of The Baltimore Sun, split its broadcasting and publishing divisions into separate, independent companies.
The broadcast division became Tribune Media. The publishing division, including The Sun, became Tribune Publishing. Tribune Publishing became tronc Inc., short for Tribune online content, last year.
Tribune Media's shares ended trading on Friday at $40.29, giving it a market capitalization of $3.5 billion.
The acquisition would be the first major deal between broadcasters since the U.S. Federal Communications Commission voted to reverse a decision that limited the number of television stations broadcasters may buy.
The deal outlines that Tribune stockholders will receive $35 in cash and 0.23 shares of Sinclair Class A common stock.
Sinclair will assume about $2.7 billion in net debt, a release said.
Once the deal is complete, Sinclair will own or operate 233 TV stations and employ more than 15,000 people.
The new broadcasting transmission standard, which Sinclair has invested in heavily and helped invent, will allow broadcasting to mobile devices and enable flow of data expected to usher in new business models.
The updated broadcast system will pave the way for hyper-local zoned advertising, more mobile news and entertainment and applications such as weather emergency alerts, vehicle traffic navigation and digital billboards.
While the acquisition won't accelerate the move to the new broadcast standard, which already is on a fast track for deployment, it will give Sinclair significant advantages, Ripley said.
