Seeking to outdo Sinclair Broadcasting, the nation’s No. 1 owner of local TV stations, 21st Century Fox and private equity firm Blackstone Group are teaming to make a bid for Tribune Media, according to a report in the Financial Times.
Citing two people familiar with the negotiations, the FT said Blackstone would provide financial resources while Fox would offer operating expertise on the station side, given its portfolio of 28 owned-and-operated stations. A deal would certainly be a welcome change of subject for the Murdoch family. Rupert Murdoch and sons Lachlan and James have been contending with ongoing strife at Fox News Channel, which continues to be a ratings machine but recently parted ways with host Bill O’Reilly after news broke of numerous sexual harassment settlements. One of the executives put in charge at FNC after Roger Ailes was ousted last year was Jack Abernethy, who continues to run Fox’s station group.
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Tribune emerged from a grueling bankruptcy at the end of 2012 and recently spun off its newspaper division into a separate company now called tronc. Its CEO in recent years had been veteran TV exec Peter Liguori, who left this spring and has not been replaced. Apart from the station group, Tribune assets include cable network WGN America and a stake in the Travel Channel.
The main draw for any buyer, though, is clearly the TV stations, which cover major markets such as New York, Los Angeles and Chicago. The FT did not estimate what a deal would cost, but based on recent M&A activity it would run well into the billions. Dealmaking instincts in the station sector have been activated since President Trump’s election kicked off a deregulation wave in Washington. A Republican-led FCC recently reinstated the so-called “UHF discount,” which offers more leeway to owners.
Many station groups have ties with the Trump Administration. Execs from Tribune and other groups attended the inauguration in January. David Smith, the chairman and former CEO at Sinclair, was also a major Trump supporter. Blackstone CEO Steve Schwarzman was picked by the president to head his business advisory council.
Station groups see relaxation of ownership caps and other limitations on owners enabling them to gain leverage with networks and MVPDs.
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