FCC Says Sinclair May Have Misrepresented Tribune Merger Details

WASHINGTON — The FCC asserts that there are “material questions” of whether Sinclair engaged in “a potential element of misrepresentation or lack of candor” in its effort to secure FCC approval of its $3.9 billion buyout of Tribune Media.

Sinclair has denied those claims.

The FCC vote to send the merger to an administrative hearing will further delay the transaction and could jeopardize the deal altogether.

The FCC’s decision to send the case for a legal hearing came even after Sinclair’s last-minute effort to revise its station divestiture plan and salvage its $3.9 billion acquisition.

But although Sinclair revised its plan for divestitures, the FCC said that the issues of misrepresentation remain.

“Given the seriousness of the issues presented, we direct the Media Bureau to hold in abeyance all other pending applications and amendments thereto related to the overall proposed Sinclair-Tribune transaction until the issues that are the subject of this Hearing Designation Order have been resolved with finality,” the FCC said.

The FCC zeroed in on the business ties between Sinclair chairman David Smith and businessman Steven Fader in connection with the plan to sell Tribune’s WGN-TV Chicago to a new entity controlled by Fader for $60 million. That plan raised hackles from merger opponents because the purchase price was so far below fair market value for a Chicago TV station. Fader is CEO of Atlantic Automotive Group, in which Smith has an equity interest and also sits on its board. The commission’s order noted that Fader had no prior broadcast TV experience, and the transaction was structured as to give Sinclair sway over the station’s operations.


FCC Votes to Send Sinclair-Tribune Merger to Administrative Hearing

Sinclair Revises Divestiture Plan to Save Tribune Merger, Denies Misleading FCC