The Federal Communications Commission on Thursday said it had approved the merger of local television giants Nexstar Media Group and rival Tegna, the same day that two lawsuits trying to block the deal were announced.
Nexstar said last August that it would buy Tegna for $6.2 billion. The deal would create a company that owns 265 television stations in 44 states and the District of Columbia, most of them local affiliates of ABC, CBS, Fox and NBC.
FCC Chairman Brendan Carr said the company had agreed to divest itself of six of those stations, including one in Colorado.
In Denver, Nexstar is the parent company of KDVR-Fox31 and KWGN-CW2, while Tegna owns NBC affiliate KUSA-9News and KTVD-My20. Nexstar agreed to sell KTVD within the next two years, according to FCC filings.
Broadcast TV merger could spell layoffs, programming changes for 9News and Fox31
“This transaction is essential to sustaining strong local journalism in the communities we serve. By bringing these two outstanding companies together, Nexstar will be a stronger, more dynamic enterprise — better positioned to deliver exceptional journalism and local programming with enhanced assets, capabilities, and talent," Nexstar’s founder, chairman and CEO Perry Sook said in a news release.
Brendan Carr, chairman of the FCC,
"While Nexstar will own less than 15% of television stations after this deal, the transaction allows them to 'increase' local news and compete in a more balanced way against the much larger players that now dominate today’s media market," Carr said.
The announcement comes directly on the heels of attorneys general in Colorado and seven other states joining DirecTV in filing lawsuits to block the merger, arguing that it will lead to higher prices for consumers and stifle journalism.
Nexstar announced last August that it would buy Tegna for $6.2 billion.
The Colorado Attorney General's Office said the merger "would create a dominant local broadcast station" with more than 57% of the Denver television market controlled by a single company.
“If this merger succeeds, it will reduce competition in local news operations, Colorado viewers will have less choice in news, and there will be less diversity in perspectives," Colorado Attorney General Phil Weiser said in a statement. "...Competition in the local media market is critical for a healthy democracy, an informed citizenry and affordable access to sports, news and primetime shows."
The state attorneys general were joined on Thursday by DirecTV, which also filed a lawsuit seeking to block the merger. “Nexstar’s purpose in acquiring Tegna is to drive up the price it can extract from DirecTV and other distributors, which will force them to raise prices to their subscribers,” the company said.
Nexstar said the deal would allow it to compete more effectively with richer legacy media companies and Big Tech. But in the lawsuit by the states, filed with the U.S. District Court in Sacramento, Calif., the eight Democratic attorneys general argued that it would come with a price.
The action was filed by the top lawyers in California, Colorado, Connecticut, Illinois, New York, North Carolina, Oregon and Virginia. DirecTV filed a separate case in the same court.
“If this merger moves forward, cable prices will spike for consumers in New York and across the country,” said Letitia James, New York attorney general, on Thursday.
The state lawyers argued the merger would run afoul of federal laws designed to protect against monopolies. It would also require a change in federal rules that limit how many stations that one company can own, although Federal Communications Commission Chairman Brendan Carr has advocated for loosening those restrictions.
The merger in February by President Donald Trump, who wrote on social media that “we need more competition against THE ENEMY, the Fake News National TV Networks.”
Nexstar last fall in ordering its ABC stations to yank late-night host Jimmy Kimmel following comments he made about assassinated Republican activist Charlie Kirk, briefly leading to Kimmel’s suspension. But ABC brought Kimmel back following an outcry, and Nexstar .
Given Nexstar’s tendency to consolidate newsrooms in communities where it owns more than one station, both lawsuits expressed concern that the merger would hurt the already-struggling local news business. There are 31 markets across the country where Nexstar and Tegna own at least one station, according to the lawsuit.
“We all benefit when local newsrooms compete to get stories,” James said.
The attorneys general said they were open to having other states support their actions -- even those whose chief legal officials are Republicans.
