Television station owner Sinclair Corp. has acquired a stake in fellow broadcaster EW Scripps, signaling its intention to become a giant in a shrinking field.
In a filing with the Securities and Exchange Commission on Monday, Sinclair disclosed its interest in Scripps, which owns stations in Fresno, Bakersfield, Buffalo, New York, and Billings, Montana. The Baltimore-based company announced it has acquired approximately 8% of Scripps’ stock by purchasing a portion of publicly traded stock.
“We have had constructive discussions with (Scripps) for several months regarding the possibility of combining our companies,” Sinclair said in a statement.
No agreement has been reached.
Cincinnati-based Scripps indicated in a statement that it is not interested in partnering with Sinclair, saying Scripps’ board and management team is instead “focused on increasing value for all shareholders through the continued execution of our strategic plan.”
“The board and management team are united in doing only what is in the best interest of all of the company’s shareholders, employees, and its many communities and audiences across the country,” Scripps said.
Mr. Sinclair appears to be putting pressure on Mr. Scripps by purchasing stock and disclosing information. Scripps stock soared more than 34% at midday Monday to about $4 a share. The company’s valuation is approximately $363 million.
Sinclair stock also rallied, rising about 6.5% to just above $17. The company’s market value is $1.2 billion.
Television executives are hoping that President Trump and his appointments to the Federal Communications Commission will eliminate government-imposed limits on broadcast ownership. Broadcasters are currently restricted from owning electrical outlets that serve more than 39% of the U.S. population.
Sinclair currently owns or operates 185 television stations in 85 markets.
He demonstrated his willingness to work on large-scale deregulation. The anticipated push has led to a flurry of deals among broadcasters as more consumers get their news through social media.
In his filing, Mr. Sinclair nods to the changing political winds in Washington.
“Recent industry consolidation and increased competition reinforce[Sinclair’s]view that further scaling of the television broadcast industry is essential to address long-term headwinds and compete effectively with large Big Tech companies, large media companies, and large broadcast groups,” Sinclair wrote.
In September, the host made comments about the suspected shooter, who was later arrested and charged. Sinclair owns several ABC affiliates and dropped “Jimmy Kimmel Live!” Over a week.
Sinclair asked Kimmel to make a “significant personal donation” to Kirk’s political organization, Turning Point USA.
But after Disney’s upper management returned without making the concessions Sinclair had requested.
Critics point to a decline in the number of ground workers and journalists covering the communities where stations are based.
Sinclair’s application refutes those claims, writing that “increased scale would also enhance the station’s ability to maintain its vital public service role of producing local news.”
The filing said merging Scripps could have “anticipated annual synergies of more than $300 million.”
“The proposed merger would be structured so that the combined companies would maintain their respective debt and preferred capital structures and would not require external financing,” Sinclair wrote in the filing. “This transaction will allow us to significantly reduce leverage through the realization of synergies, reducing future refinancing risks while avoiding significant refinancing costs.”
Sinclair said in its 2024 annual report that its dozens of stations deliver “more than 2,400 hours of live news coverage per week across our various digital, social and audio platforms, as well as across our station footprint.”
Sinclair said in Monday’s filing that it is “committed to engaging constructively with (Scripps) toward reaching a definitive transaction agreement,” and that Sinclair hopes to integrate its fellow broadcasters “within nine to 12 months.”
Mr. Scripps took a defensive stance against Mr. Sinclair’s overtures, saying in a statement that “the board will take all appropriate steps to protect the company and its shareholders from the opportunistic actions of Sinclair and others.”
Elsewhere in the local TV business, Texas-based Nexstar, the nation’s largest television broadcaster, is seeking power.
