By Bill O’Boyle - [email protected]

Parent company of WNEP to be acquired by Sinclair Broadcasting Group

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Gary Weitman, Senior Vice President for Corporate Relations at the Tribune Tower in Chicago.

WILKES-BARRE — Tribune Media Company, the parent company of WNEP-TV, will be acquired by Sinclair Broadcast Group, according to a news release issued Monday.

The acquisition will cost Sinclair $3.9 billion dollars, plus the assumption of approximately $2.7 billion in net debt, the release states.

In addition to WNEP, Tribune owns or operates 42 television stations, cable network WGN America, and Antenna TV and has minority stakes in the Food Network and CareerBuilder in addition to a variety of real estate assets. Locally, Sinclair also operates FOX56, WOLF, WQMY, and MYTV.

“This is a transformational acquisition for Sinclair that will open up a myriad of opportunities for the company,” Chris Ripley, president and CEO of Sinclair, said in the news release. “The Tribune stations are highly complementary to Sinclair’s existing footprint and will create a leading nationwide media platform that includes our country’s largest markets.”

According to a report by the Associated Press, Sinclair has 173 stations, including KENV in Salt Lake City, KOMO in Seattle and WKRC in Cincinnati. The Tribune deal, plus other pending acquisitions, will give it a total of 233 stations, putting distance between it and rival Nexstar Media Group, which has 170.

Sinclair said it may have to sell some stations to comply with Federal Communications Commission rules, although the FCC has recently loosened rules related to media ownership. Sinclair is also in the process of buying Bonten Media Group, which owns 14 stations, for $240 million.

In all, Sinclair said its stations will reach 72 percent of all U.S. households with a TV once the Tribune and Bonten deals close.

Ripley went on to say the acquisition will enable Sinclair to build ATSC 3.0 — Next Generation Broadcast Platform — advanced services, scale emerging networks and national sales, and integrate content verticals. He said the acquisition will also “create substantial synergistic value through operating efficiency, revenue streams, programming strategies and digital platforms.”

Gary Weitman, senior vice president of corporate relations at Tribune Media in Chicago, said, “We’re letting the release speak for itself. Not commenting beyond the release.”

Under the terms of the agreement, Tribune stockholders will receive $35 in cash and 0.23 shares of Sinclair Class A common stock for each share of Tribune Class A common stock and Class B common stock they own. The total $43.50 per share consideration represents a premium of approximately 26 percent over Tribune’s unaffected closing share price on Feb. 28, the day prior to media speculation regarding a possible transaction; approximately 14 percent over Tribune’s 30-day volume weighted average closing stock price; and approximately 8 percent over Tribune’s closing share price on May 5, the last trading day prior to Monday’s announcement.

“This will be the largest acquisition in our company’s history, and I want to thank everyone from the Sinclair team, as well as our advisors and bankers who made this possible,” commented David Smith, executive chairman of Sinclair. “Television broadcasting is even more relevant today, especially when it comes to serving our local communities. Tribune’s stations allow Sinclair to strengthen our commitment to serving local communities and to advance the Next Generation Broadcast Platform. This acquisition will be a turning point for Sinclair, allowing us to better serve our viewers and advertisers while creating value for our shareholders.”

Peter Kern, Tribune’s chief executive officer, said the announcement is the culmination of an extensive strategic review, which has delivered significant value to stockholders.

“Since we announced the strategic review 15 months ago, we have streamlined the business, monetized non-core assets, strengthened our balance sheet and returned more than $800 million to stockholders — all of which has resulted in a 50 percent increase in stockholder value. We are extremely proud to join Sinclair.”

The transaction has been unanimously approved by the boards of directors of both companies and is anticipated to close and fund in the fourth quarter of 2017. Completion of the transaction is subject to approval by Tribune’s stockholders, as well as customary closing conditions, including approval by the Federal Communications Commission and antitrust clearance.

Gary Weitman, Senior Vice President for Corporate Relations at the Tribune Tower in Chicago. Weitman, Senior Vice President for Corporate Relations at the Tribune Tower in Chicago.

By Bill O’Boyle

[email protected]

Reach Bill O’Boyle at 570-991-6118 or on Twitter @TLBillOBoyle.

Reach Bill O’Boyle at 570-991-6118 or on Twitter @TLBillOBoyle.