Sinclair attempts to appease F.C.C., but his Tribune offer is disputed

Sinclair Broadcast Group, the largest local television operator in the United States, attempted to appease federal regulators on Wednesday regarding its proposal to buy a competing television group. But the Federal Communications Commission voted unanimously for a judge to review some aspects of the deal, a potentially disturbing sign of the merger.

The company, known for amplifying the Trump administration's talking points in many local news reports, is looking to buy Tribune Media for $ 3.9 billion. The deal would place Sinclair, based in Maryland, under the control of broadcasters reaching seven out of ten households across the country, including New York, Chicago and Los Angeles.

To satisfy the rules that prohibit a single company from owning waves on such Sinclair had previously proposed to sell 23 television stations after the conclusion of the deal. But many of these stations would actually remain under its operational control.

The F.C.C. The president, Ajit Pai, said Monday that he had "serious concerns" about these planned divestitures. Mr. Pai asked the four commissioners of the agency to pass his merger review to an administrative law judge to determine the legality of Sinclair's original proposal.

The company said on Wednesday that it was now going to sell two of the stations in question, one in Dallas and another in Houston, through an independent trust after closing the deal with Tribune. A third station, WGN in Chicago, owned by Tribune, would be sold directly to Sinclair to make control of the station more transparent.

But Sinclair 's modified plans apparently had no effect on the FCC' s decision regarding the order of Mr. Pai, which the agency will release on Thursday.

Sinclair tries to create a conservative news operation to compete with Rupert Murdoch's Fox News. If the company manages to buy Tribune, it will control more than 200 stations reaching 62% of homes.

Sinclair's divestiture plan was carefully reviewed because many of the stations it planned to sell would remain under Sinclair's control. "Sidecars."

The show 's giant planned to sell Chicago' s train station to a Maryland businessman, Steven Fader, who has connections with Sinclair 's executive chairman, David D. Smith. The company would get $ 60 million in the sale, but it would continue to sell advertising and provide programming for the station. Sinclair would also take 30% of the station's revenues in fees for this service.

Sinclair also agreed to sell the Dallas and Houston stations to Cunningham Broadcasting, a private company controlled by Mr. Smith's family, according to the securities filings. Three other stations that Sinclair plans to sell also include sidecar agreements. The company has not changed its sales plans for these stations.

These contracts effectively provide regulatory coverage by transferring the F.C.C. said Craig Aaron, president of the consumer advocacy group Free Press.

The Tribune purchase by Sinclair is disputed on other fronts. Government rules prohibit a company from reaching more than 39% of the television audience, but Sinclair benefits from a newly loosened loophole that allows the company to reach that point. ceiling thanks to the UHF reduction. some TV channels deduct half of their audience in areas where it transmits on the UHF standard, which emits a weaker signal. For decades, broadcasting companies, with the goal of expanding their business and competing with emerging cable channels, have exploited this technicality, allowing broadcasting groups to consolidate.

The F.C.C. closed the loophole under the Obama administration, which argued that the move to digital television – mandated by the agency in 2009 – dissolved any difference in broadcast standards, making the UHF designation a denomination of an obsolete technology.