Critics of the $8 billion-plus purchase of Tegna’s TV station group by investment fund Standard General have told the FCC it needs to collect more data on the proposed merger before it rules on whether it is in the public interest.
Common Cause, joined by the NewsGuild-CWA union and Public Knowledge, have filed a formal motion for both additional documents that the FCC and the public can peruse and an extension of time to weigh in. Currently, the FCC has set a May 23 deadline for those wishing to formally oppose the deal.
The groups already have a pretty good idea of whether the deal, which also includes spinning some Tegna stations off to Apollo Global Management, is in the public interest, which they clearly believe it is not.
“Congress and the Biden Administration extended billions of dollars in taxpayer money last year to ensure the survival of local journalism during the COVID-19 pandemic,” the motion says, adding: “Contrast that with the proposed transaction, apparently financed on the back of local journalism job cuts and centralized news operations.”
They argue that the companies’ application for transfer of licenses leaves too many questions unanswered, like whether they told their bankers that increased retransmission consent fees would help pay for the deal and that there would be massive layoffs. The groups do not say any such representations were made, but instead posit them as possibilities that need to be ruled in or out.
They warn: “If the applicants are trying to gerrymander their TV station ownership with the sole or primary goal of retransmission fee increases, these transactions should be stopped without further ado” because they are basically a case of “sophisticated price gouging.”
The motion suggests that the deal would enrich private equity firms that have already “swallowed” smaller broadcast groups.
The documents they are looking for include any financial presentations addressing each company’s evaluation of the deal, any prospectuses used to market the deal, any analysis supporting their contention that the deal would make it easier to invest in local content and production, any documents pertaining to potential consolidation of news operations, any documents on shared services or local marketing agreements, any documents related to most favored nation clauses in retrans agreements, any retrans agreements with MVPDs and network affiliation agreements since 2015, and much more.
As to the May 23 deadline, they say the deadline should be extended to 30 days after the merging parties have responded to the hoped-for FCC request for additional information.
In a related move, the NewsGuild said Tegna’s board should postpone its planned May 17 consideration of the deal. currently set for May 17.