Nexstar announces completion of Tegna acquisition, eight state attorneys general sue to block the merger

Tegna’s headquarters in McLean, Virginia.

Nexstar Media Group (Nexstar) announced it has completed its acquisition of Tegna (Tegna), combining two of the largest U.S. television station operator groups into one.

But the deal still faces legal scrutiny: eight state attorneys general have filed an antitrust lawsuit, seeking to block the acquisition.

State officials led by California Attorney General Rob Bonta said the merger would drive up prices, weaken local news coverage, and harm consumers’ interests.

Nexstar CEO Perry Sook, however, sees it differently: “This transaction is crucial to the continued strength of local news in the communities we serve.”

When this major broadcasting-industry merger was announced last August, it immediately raised serious concerns among media watchdog groups, but Wall Street analysts said the trend is inevitable and predicted further consolidation for the troubled broadcast TV industry.

As Nexstar sought approval for the deal from the Trump administration, Sook personally courted President Donald Trump.

The related approval was announced Thursday afternoon, and Nexstar immediately said the deal had been “closed.”

Sook thanked Trump and his administration for “recognizing the dynamic force that shapes the media landscape and moving this transaction forward.”

In its statement, Nexstar did not mention the pending lawsuit. The complaint from the eight state attorneys general was filed with the U.S. District Court for the Eastern District of California on Wednesday night. On Thursday, DirecTV, a leading satellite TV distributor, also filed another lawsuit.

A spokesman for Bonta confirmed to CNN that the attorney general’s lawsuit will continue.

This lawsuit is the latest example of Democratic state attorneys general checking Trump—Trump had publicly backed the Nexstar deal last month.

In a news conference Thursday morning, attorneys general from California, New York, and Illinois emphasized that after the Nexstar–Tegna merger, the business would cover 44 states, an enormous scale.

“This merger is clearly unlawful, violating federal antitrust laws that protect consumers,” Bonta said.

Bonta, New York Attorney General Letitia James, and Illinois Attorney General Kwame Raoul said the Nexstar–Tegna deal threatens the local news industry, pointing to recent layoffs at Nexstar’s Los Angeles, Chicago, and New York newsrooms.

“When local newsrooms compete to report exclusive stories, investigate misconduct, and provide information to the public, we all benefit—yet this merger puts all of that at risk,” James said.

Bonta said the merger would be a “severe blow” to a thriving democracy that depends on informed citizens.

Bonta also vowed to “actively” review the pending Paramount acquisition of Warner Bros. Discovery (the media giant that owns CNN).

Raoul said, “Consumers and communities will have fewer news options and it will be harder to access diverse viewpoints.”

The state lawsuit contrasts sharply with the federal government’s stance toward the deal.

Last fall, Trump had been skeptical of the Nexstar–Tegna merger, but this February he reversed course on the “Real Social” platform, saying Nexstar’s acquisition “will help beat fake news because competition will be fiercer and at a higher, more mature level.”

And in practical terms, competition in markets such as Denver, Seattle, and Dallas will therefore decrease.

For Nexstar’s acquisition of Tegna, the U.S. Federal Communications Commission (FCC) must handle the national TV ownership rules—rules that bar a single company from owning stations reaching more than 39% of U.S. television households.

Trump’s ally at the FCC, Chair Brendan Carr, previously said he hoped to raise that ceiling, and last month said that the president’s support for the Nexstar deal was “completely right.” “Let’s get it done,” Carr wrote.

The coalition of state attorneys general highlighted the Trump administration’s support for the deal, and Bonta said, “That’s what requires us to take these important actions.”

Political maneuvering in the Trump era for Nexstar

Sook spared no effort to please Trump, branding the company as “anti-fake news,” and appearing on Fox Business with Maria Bartiromo to praise Trump’s policies. Media observers questioned whether a newly launched pro–“Make America Great Again” (MAGA) talk show on Nexstar’s national cable channel NewsNation was also aimed at currying favor with the president.

But the Nexstar–Tegna deal also created fractures within conservative media. Newsmax and One America News Network lobbied hard against the transaction.

Last autumn, Carr publicly criticized ABC late-night host Jimmy Kimmel. Nexstar removed Kimmel’s show from its ABC affiliate stations almost immediately, and Nexstar’s moves to seek approval from the Trump administration became national news.

Nexstar denied that it was influenced by Carr’s remarks, but others believed it had yielded under pressure from the Trump administration, sparking widespread criticism. A few weeks later, Nexstar resumed airing Kimmel’s show on its ABC affiliate stations.

In a statement, Matt Wood, general counsel for the media reform organization Free Press, said: “Carr disregarded the law and the facts of this merger, promised to help President Trump facilitate the deal, and also pressured newsrooms, distorting how they report on the government.”

Wood hinted at the Kimmel controversy, saying: “If that means closing the deal and cementing its dominance over local airwaves, Nexstar is all too eager to submit to Carr’s bullying.”

But Nexstar and its allies argued that broadcast-industry consolidation is necessary so station owners can compete with much larger streaming and social media platforms.

Carr made similar comments when he announced approval of the deal Thursday afternoon.

He said the case was exempt from the national TV ownership rules, “consistent with the FCC’s long-standing authority.” Media reform advocates said this exemption could invite legal challenges.

FCC’s sole Democratic commissioner, Anna Gomez, condemned the deal’s “backroom” approval—approved without a full commission vote.

“The consequences of this stamp-of-approval will be felt in households and newsrooms across the country, leading to fewer voices, weaker competition, and higher consumer costs,” Gomez said.

However, in a statement, Sook insisted that “by bringing these two outstanding companies together, Nexstar will become a stronger, more dynamic company—with more abundant resources, capabilities, and talent, and better positioned to deliver outstanding news coverage and local programming.”

Countless insights, precise analysis—everything on the Sina Finance App

Editor: Guo Mingyu