Illustration: Sarah Grillo/Axios
Nexstar agreed Wednesday morning to divest 19 of its local TV stations in 15 markets across the country in order to gain regulatory approval in its deal to acquire Tribune Media.
Why it matters: Regulators have rules about how many stations one operator can own in a single market, so that they can ensure a diversity of voices exists in each community. Nexstar is divesting these stations to get the merger approved under these rules.
Details: The total sale amounts to $1.32 billion.
- TEGNA Inc. will acquire 11 stations in 8 markets for $740 million and the E.W. Scripps Company will acquire 8 stations in seven markets for $580 million.
- Nexstar says it plans to use the proceeds from this sale to reduce debt.
Between the lines: Nexstar's proposed $4.1 billion acquisition deal for Tribune Company would make it the country's largest owner of local television stations.
- Some TV network distributors like Dish and consumer advocates are protesting the merger, arguing it would give Nexstar too much leverage in pricing negotiations and dominance over local television.
The big picture: Changes in decades-old broadcasting rules, combined with new types of competition in news and entertainment, are creating a drama-filled free-for-all as local U.S. broadcasters consolidate.
- This deal comes months after Sinclair Broadcast Group's $3.9 billion deal bid for Tribune Media fell through, when Sinclair was accused of lying to regulators.
- Nexstar says the deal with Tribune is expected to close later this year.
What’s next: Nexstar says it remains engaged in active negotiations to divest two stations in Indianapolis, Ind.