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Broadcast giant Sinclair has taken a more than 8% stake in EW Scripts as it eyes a potential merger with the smaller local TV rival.
In a regulatory filing on Monday, Sinclair disclosed that it purchased 8.2% of Scripps Class A common stock “in contemplation” of a broader bid to acquire the company.
Sinclair said it had talked with Scripps for months “concerning a potential combination” – and said overall increasing scale is needed to “address secular headwinds and compete effectively” in the US media landscape, pointing to increased competition and other recent consolidations seen across the industry.
Scripps acknowledged Sinclair’s new stake and said its board would “continue to evaluate any transaction” in the best interests of shareholders. But at the same time, Scripps said it would also take steps to protect itself from “opportunistic actions by Sinclair or anyone else.”
shares The value of Scripps rose nearly 40% on Monday, and by market close it was trading at about $4.28. Meanwhile, Sinclair stock closed 4.91% higher at $16.87.
The possibility of Sinclair buying Scripps comes amid widespread consolidation in the US media industry – particularly in the local TV landscape. Just last August, Nexstar Media Group announced a $6.2 billion deal to buy broadcast rival Tegna.
Companies like Sinclair – as well as Nexstar and Tegna – have argued that this type of acquisition would allow them to better compete with both the big media and tech players vying for consumers’ attention today. But critics warn of widespread homogenization of news. In other words, more and more local TV stations are becoming “duplicators” of syndicated reporting – and sharing corporate owners who may decide not to air certain content.
For example, in September, both Nexstar and Sinclair chose to operate in advance jimmy kimmellate-night shows on their ABC-affiliated stations over comments made by comedians following the murder of a conservative activist. charlie kirkThe blackout continued for more than a week in dozens of local TV markets, even after Disney-owned ABC lifted its suspension,
Sinclair Broadcast Group, based in Hunt Valley, Maryland, owns, operates or services 185 TV stations in 85 markets affiliated with all major broadcast networks and owns the Tennis Channel. The company has a reputation for a conservative approach in its broadcasts.
During this time, cincinnatiThe Ohio-based E.W. Scripps Company operates more than 60 local stations in more than 40 markets. It also owns national news outlets Scripps News and Court TV as well as entertainment brands such as ION.
It remains to be seen whether the two companies agree to a merger – and they will still need the regulatory greenlight. But it may be a possibility under the Trump administration. For example, Nexstar’s proposed merger with Tegna would require the Federal Communications Commission to change rules limiting the number of stations a company can own, and FCC Chairman Brendan Carr has already expressed openness to changing the rule.