11.20.2006 08:00 AM
Cross-ownership rules may be a factor in Tribune TV sale
The Tribune Company is now selling some of the nation’s highest profile media properties. Among them are three premier TV stations: KTLA in Los Angeles, WPIX in New York and WGN in Chicago.
Behind the sales is looming uncertainty about media ownership rules. One reason for two of the station sales, reports the “Los Angeles Times,” is the pending expiration of the station’s broadcast licenses. Another, WGN, has major tax implications for its owner.
On Dec. 1, KTLA’s eight-year license expires. The newspaper said at that time Tribune could be found in violation of FCC regulations banning ownership of a newspaper and a broadcast outlet in the same market, because it also owns the “Los Angeles Times.” The same scenario is playing out in New York, where Tribune owns “Newsday” and WPIX, whose license expires next June.
The “Times” said that when the Tribune bought the “LA Times” and “Newsday” in 2000, it had hoped cross-ownership rules would be lifted before the licenses expired. But, with the Democrat sweep in Congress in the recent election, the chance of that happening has been greatly reduced.
WGN has been a Tribune property since 1948. In this case, a sale could have negative tax implications for the company. Estimates are that the three stations could bring more than $2.5 billion before taxes.
Shaun M. Sheehan, Tribune’s vice president for Washington affairs, told the “Times” last week that the company hoped to obtain temporary waivers for KTLA and WPIX. If KTLA’s renewal application is rejected, he said, Tribune would appeal the decision to federal court.