Sinclair Broadcast Group offered a revised plan to sell TV stations to satisfy regulators vetting its $3.9 billion purchase of Tribune Media Co., saying it would keep New York's WPIX and offer other stations to friendly buyers in transactions that have drawn criticism.
Signature station WGN in Chicago would go to a business associate of a top Sinclair executive, while other outlets would be sold to a company controlled by the estate of his mother. Howard Stirk Holdings, owned by conservative commentator Armstrong Williams, would buy some stations, as would New York-based hedge fund Standard General led by Soo Kim. Meredith Corp. would buy one.
Sinclair didn't list a potential sale of WPIX, the New York station that it earlier proposed divesting to satisfy regulators.
The Tribune transaction would give Sinclair, which has 193 stations, an additional 42 stations in 33 more markets. The Maryland-based broadcaster is known for its conservative leanings, including commentaries by Boris Epshteyn, a former aide to President Donald Trump.
As proposed in May the deal would leave Sinclair reaching more than 70 percent of U.S. homes, exceeding an ostensible national limit of 39 percent. Sinclair said the divestitures proposed Tuesday it would bring it into compliance with the national cap. That calculation assumes it can count some stations' audience on a discounted basis, a procedure approved by the U.S. Federal Communications Commission but under legal attack.
"While we continue to believe that we had a strong and supportable rationale for not having to divest stations, we are happy to announce this significant step forward in our plan to create a leading broadcast platform with local focus and national reach," Sinclair President Chris Ripley said in a news release.
The transactions are aimed at gaining regulatory approval for the Tribune deal and are expected to be completed when that purchase closes, Sinclair said on Tuesday. The company is seeking approval from the FCC as well as antitrust regulators at the Justice Department.
Sinclair had planned to complete the deal by the end of 2017, but now sees it closing by the second quarter of this year. The company has had to increase the level of divestitures in order to push the transaction through.
Sinclair said it would share the operations of WGN as well as the three stations proposed for sale to Armstrong's Howard Stirk. Those three are in Seattle, Salt Lake City and Oklahoma City, and Sinclair also would retain outright ownership of a station in each city.
Such sharing arrangements have been criticized as end runs around ownership restrictions.
Moelis & Co. served as Sinclair's financial adviser on the TV station deals. They include the sale of WGN, KDAF in Dallas to Cunningham Broadcasting Corp. and KUNS in Seattle to Howard Stirk Holdings. Meredith is also buying KPLR in St. Louis, a CW affiliate, for $65 million.
Sinclair on Tuesday said WGN's proposed purchaser is WGN-TV LLC. In an earlier filing, it identified that buyer as belonging to a Maryland executive, Steven Fader, whose car dealership is controlled by Sinclair Executive Chairman David Smith, according to a Sinclair securities filing. Cunningham is owned by the estate of Carolyn Smith, the mother of Sinclair's controlling shareholders, including Smith.
Tina Pelkey, an FCC spokeswoman, declined to comment.