The long-anticipated Standard General-Tegna merger won’t be happening before the new year, as the Federal Communications Commission (FCC) has requested another round of comments concerning the deal.
The request came shortly after Standard General announced a series of formal commitments to ease regulators’ concerns about how the $8.6 billion merger would affect journalism jobs and retransmission consent agreements.
On December 16, the company told the FCC it will waive retransmission consent agreements (RCA) between current Tegna-owned stations and Standard General’s Cox Media Group stations, giving MVPDs the option to accept or decline the waiver. Meaning MVPDs that currently have a retrans agreement with Tegna can keep that agreement – without an increase in rates – once the transaction concludes.
The initiative saw fruition this week, with Comcast Cable signing onto an RCA with Standard General.
"Standard General welcomes this agreement and looks forward to continue working with its MVPD partners and other stakeholders in building a bright, secure future for local broadcasting in America," the company stated.
Standard General addressed further concerns in two subsequent letters to the FCC, dated December 22 and 23, respectively. In the first letter, the company pledged it will not cut any journalism jobs for at least two years post-transaction, echoing what Standard Media CEO Deborah McDermott told Fierce Video this summer.
Yet Standard General noted in the letter it “cannot predict how future economic conditions or changes in the broadcast industry may require broadcasters to make adjustments in the composition or size of station staffing to best serve the needs of the public.”
Additionally, Standard General said it will recognize any labor union covered by a collective bargaining agreement with Tegna, emphasizing it will be “happy to engage with the labor unions to discuss any existing or outstanding grievances.” Some labor unions have expressed opposition towards the merger, namely the CWA’s NewsGuild and NABET divisions.
Then, on December 23, Standard General aimed to alleviate NCTA’s concerns about “interlocking relationships” between Standard General, Apollo Global Management (which is financing part of the deal) and Apollo subsidiary Cox Media Group.
Standard General stated it, Apollo and CMG are willing to agree to all of NCTA’s terms for the merger’s approval. Specifically, no employee or agent from any of those companies “that may be involved in retransmission consent negotiations may review any retransmission agreement to which the other entity is a party.”
NCTA’s conditions would apply as long as Standard General owned Tegna, Standard General wrote.
The FCC is giving interested parties until January 13 to file comments, with replies to those comments due on January 20.
Despite the agency initiating another round of comments, analysts from New Street Research believe the deal is still in the end game, with the FCC likely to resolve the matter within 60 days after reply comments are due. Meaning the transaction will likely close sometime in February.
“We don’t think the SG offers are final, but we think they are close, and they cover the principal areas of contention,” wrote NSR’s Blair Levin in a Tuesday note. “We think the stakeholders will engage in a lot of debate over the next month, particularly about the enforcement mechanisms for the jobs commitment, as well as the details of preventing post-consumption coordination.”
Levin also brought to attention the U.S. Department of Justice has yet to sign-off on the deal. Standard General and Tegna broke ground in the proceedings last month when they got the regulatory thumbs-up from the “Team Telecom” interagency committee. But the merger still awaits final review from the DoJ.
Whatever speculation the DoJ may have, Levin noted “we doubt the FCC would have established the final comment cycle if it did not have a good idea of what would alleviate the DoJ concerns.”