One Media Giant Moves to Take Over Another

Sinclair has submitted a bid to buy out EW Scripps for $7 per share, in a deal that could bring further consolidation across America's local TV news landscape. Under the proposal, which Sinclair disclosed Monday, the broadcast giant would acquire all of Scripps' outstanding shares that it doesn't already own. Sinclair upped its stake in Scripps recently—accounting for nearly 10% of the company's class A common stock as of Nov. 17, per regulatory filings.

• The proposed $7 per share buyout would consist of both cash and stock. If approved, the deal would give Scripps' shareholders about a 12.7% stake of the combined company upon closing, the AP reports. Sinclair is requesting a response from Scripps by Dec. 5.

• "We are submitting an updated, actionable merger proposal," Sinclair CEO Christopher S. Ripley wrote in a letter to Scripps' board. He said the deal would "strengthen local journalism" and "position the combined company and employees for long-term success."
• Scripps acknowledged that it had received an "unsolicited acquisition proposal" from Sinclair on Monday. The Ohio-based company said its board would review the offer like any other offer—and determine next steps based on the interests of its stakeholders and "audiences it serves across the United States." Scripps previously said it would also protect itself from any "opportunistic actions of Sinclair or anyone else."
• Sinclair Broadcast Group owns, operates or provides services to 185 TV stations in 85 markets affiliated with all major broadcast networks, and it also owns the Tennis Channel. The Maryland-based company has a reputation for a conservative viewpoint in its broadcasts. Meanwhile, EW Scripps Co. operates more than 60 local stations in over 40 markets. It also owns national news outlets Scripps News and Court TV, as well as entertainment brands like ION.

• Sinclair has been eyeing Scripps for some time. Last week, the Maryland-based company said it held months of talks "regarding a potential combination"— and maintained more broadly that increasing its scale is "essential to address secular headwinds" in the US media industry, pointing to growing competition. Just this past August, Nexstar Media Group announced a $6.2 billion deal to buy broadcast rival Tegna.
• In a letter to Scripp's board of directors, Sinclair CEO Chris Ripley said the combined company would maintain "meaningful operations" in both Ohio and Maryland, Variety reports. "Sinclair is supportive of retaining the EW Scripps corporate name or selecting a new corporate name," he wrote.
• Even if Scripps accepts Sinclair's proposal, like all major corporate mergers, the deal would require the regulatory greenlight. Sinclair on Monday said it was confident that its proposed transaction could be completed under existing rules.
• Media consolidation could accelerate industrywide if the Trump administration loosens restrictions—or, perhaps more immediately, makes exceptions for certain mergers. Last week, in efforts to complete its Tegna acquisition, Nexstar asked the Federal Communications Commission for a waiver on current rules that limit the number of stations a single company can own.
• FCC Chairman Brendan Carr previously signaled openness to changing those requirements overall. But some conservatives—and President Trump himself—have recently expressed disdain at the possibility of such a change leading to an expansion in networks they view as left-leaning. "If this would also allow the Radical Left Networks to 'enlarge,' I would not be happy," Trump wrote on social media Sunday.