Tribune CEO On Still-Vibrant M&A Climate, Post-Sinclair Strategy, WGN America Plans

In a conference call with investors this morning, Tribune Media CEO Peter Kern said the company will continue to look for M&A opportunities despite the demise of its long-gestating merger with Sinclair Broadcast Group.

In the wake of the $3.9 billion deal’s end, which officially came this morning with the company’s filing of a lawsuit against Sinclair, Kern didn’t offer many specifics as to where Tribune goes from here. The sting of the outcome is still being felt inside the company, he conceded.

“There’s a lot of frustration,” he said, “when people invest their blood, sweat and tears trying to do what they were supposed to do, which is close the deal.” Of the deal first proposed in May 2017, he said, “I don’t think we regret that decision. But we’re extremely pleased with the state of the business today. prospects are bright for the future.”

Being left holding the bag doesn’t make Tribune gun-shy in terms of scrutiny from regulators, Kern added.

“I don’t think the regulatory environment troubles us,” Kern said. “I think what transpired was not the result of an unwelcoming regulatory environment but more how this transaction was prosecuted by our merger partner. We feel the environment remains welcoming and open to sensible consolidation and there’s tons of activity out there.”

With 42 well-regarded local TV stations and other properties like cable network WGN America, Tribune remains an attractive acquisition target. It also has a lot of cash on its balance sheet and both the station sector and the larger M&A environment would enable it to re-enter the dealmaking fray as a buyer.

Kern was asked about the strategy of WGN America, which moved away from prestige, pricey originals like Underground after Peter Liguori exited as Tribune CEO in January 2017. He said the cable network would remain in the original programming game “in a calculated way” and at a more modest price point.

“We’re not out of the originals business,” Kern said. “But we can do it in a way that adds to our bottom line.”