WASHINGTON D.C.—The FCC has asked for a wide range of new documents as part of its assessment of the $8 billion merger of Apollo Global Management, Standard General L.P., and Tegna. 

The merger has been criticized by pay TV providers for potentially giving the station group too much power in transmission consent negotiations and by public interest groups and unions as potentially hurting local news coverage.

Standard General has pushed back against those arguments in filings with the FCC, contending that its “proposed acquisition of Tegna and the related transactions, including Standard General’s sale of eight TV stations to CMG [Cox Media Group], will yield significant public interest benefits without any countervailing public interest harms.”  

In an Sept. 30 statement emailed to TV Tech, Standard General said “Standard General, who will be the sole owner of Tegna, has consistently confirmed that its plans for post-closing TEGNA do not involve station-level layoffs”

In another email statement regarding the ongoing FCC process, Deb McDermott, the future CEO of Tegna said that “We just wish to be treated like everyone else.”

In its request for additional documents, FCC asked for financial documents presented to financial institutions and potential lenders that could shed light on potential staff cuts and investment plans. It is also asking for detailed information on local news operations, retransmission consent negotiations and the merger agreements. 

At the very minimum, the new document requests indicate that the FCC may not approve the deal before the end of October and that the process could drag on beyond that.  The deadline for the new documents is October 13. 

If the proposed $8 billion merger of Apollo Global Management (AGM), Standard General L.P., and Tegna is approved, Standard General would acquire Tegna’s 61 full power television stations and two radio stations across 50 markets. Apollo will control the licenses of 31 full-power television stations in 26 markets and 54 radio stations in 11 radio markets.

More specifically, the FCC is asking for this information: 

• “All documents, including presentations to AGM and any other financial lending or investment institutions, addressing each company’s evaluation of this transaction (as well as alternative transactions considered among the companies), the motivating reasons for each company joining in the transaction, the reasons why the transaction would be advantageous to each company, and, specifically, documents discussing the cutting of staff, the diminution or displacement of local content, and the expansion of national content;
• All documents, including without limitation offering memoranda or prospectuses, used to secure funding, or to market to, or discuss the proposed transactions with, prospective investors;
• All analyses supporting or quantifying the Applicants’ contention that the transaction will facilitate investment in local content and production capabilities, including specific business synergies and efficiencies that will facilitate such investment or otherwise aid the operation of Standard General and CMG [Cox Media Group] were the transaction to be consummated;
• All analyses and documents relating to projected future capital expenditures, personnel headcounts, and programming plans for each of the broadcast stations included in the Applications;
• For each station acquired by Standard General or CMG within the last five years, provide documentation and data with respect to the addition of local and news programming, specifically breaking out, for each station, the weekly addition (or loss) of hours of (a) local news, (b) other local programming, and (c) news and interest segments not originated by the station.  Provide documents or, if not otherwise available in document form, a narrative response describing the relationship between centrally originated programming by Standard General and CMG and any requirements for local stations to air such programming, including without limitation any written agreements or correspondence between Standard General and CMG and the stations with respect to such programming;  
• Describe in detail how a Washington, D.C. newsroom will be integrated with local stations and the extent of local station editorial control over resulting news coverage; provide all documents relating to any such proposed integration.
• All documents concerning any actual or potential consolidation of news operations or services, including impacts on personnel headcounts;
• All analyses and documents relating to Standard General’s review of the CMG retransmission agreements currently in place, including calculations of post-transaction rate increases, or, alternatively, a statement that Standard General has not reviewed such agreements; 
• All correspondence from Deborah McDermott or other Standard General executives to TEGNA employees addressing how the proposed transaction may affect staffing or conditions of employment.”

The FCC is also asking for he following schedules to the Merger Agreement:

• “Section 4.2 - Capital Stock and Indebtedness 
• Section 4.4(a) - Consents and Approvals; No Violations 
• Section 4.4(b) - Consents and Approvals; No Violations 
• Section 4.11(a) - Employee Benefits Plans 
• Appendix 4.11(a)(i) Appendix 4.11(a)(ii) Section 4.11(e) - Multiemployer Plans 
• Section 4.11(g) - Post-Employment Benefits 
• Section 4.15(a)(iii) - Tax Matters
• Section 4.16 - Employment and Labor Matters 
• Appendix 4.16(c) 
• Section 4.20 - MVPD Matters 
• Section 4.21 - Finders or Brokers Section 6.5(a) - Employee Matters 
• Section 6.6(e) - Regulatory Approvals, Efforts”

 In addition it has requested the following schedules to the Contribution Agreement: 

• “Section 1.01 - Permitted Liens 
• Section 3.04 - FCC and Programming Distribution Matters 
• Section 3.13 - Financial Statements 
• Section 4.05 - FCC and Programming Distribution Matters 
• Section 4.06 - Taxes 
• Section 4.12 - Employees; Labor Matters; Employee Benefit Plans 
• Section 4.15 - Financial Statements”

WASHINGTON, D.C.—The NCTA has told the FCC that it will not oppose Standard General’s deal for Tegna if the FCC “adopts binding conditions to ensure that the affected broadcasters comply with the bar on joint retransmission consent negotiations codified in the Communications Act and the Commission’s rules.” 

If the $8.6 billion merger of Apollo Global Management (AMG), Standard General L.P., and Tegna is approved, Standard General would acquire Tegna’s 61 full power television stations and two radio stations across 50 markets. Apollo will control the licenses of 31 full-power television stations in 26 markets and 54 radio stations in 11 radio markets.

In a letter to the FCC, the NCTA proposed a number of binding conditions on how the broadcasters negotiate retransmission agreements that would codify what Standard General and Tegna have already promised the Commission. 

More specifically, the NCTA noted that Standard General and Tegna have told the FCC that they will negotiate retransmission consent separately and not “enter into any Sharing Agreements or other agreements related to programming, operations, or sale of advertising with each other for any station.” 

The NCTA also noted that the broadcasters have assured the FCC that the security holdings of AGM and the Cox Media Group in post-transaction Tegna do not give the them “any right or ability to participate in the day-to-day management or operations of Post-Transaction Tegna or in Post-Transaction Tegna’s negotiation of contracts (including retransmission contracts)” and that “AGM and CMG also will have no right of access to or ability to review any competitively sensitive confidential information of Post-Transaction Tegna, including Post-Transaction Tegna’s retransmission consent agreements.”

Despite these promises, NCTA stressed that “the proposed transaction creates a web of interlocking interests among the companies – Standard General/Tegna and CMG/Apollo – thus raising concerns about information-sharing and coordination of retransmission consent negotiations” that would violate FCC rules regarding retransmissions consent negotiations. 

“According to one report, Apollo is loaning Standard General nearly $700 million to finance its purchase of Tegna,” the NCTA said. “Another report states that `Apollo also apparently will invest $925 million in preferred equity funding’ in the transaction. The transactions also involve a host of station swaps between Tegna and CMG. The collection of interlocking relationships creates, in the aggregate, a high risk that the parties, post transaction, will have the incentive and the ability to share information or otherwise coordinate their retransmission consent negotiations. If such coordination were to occur, it could violate the ban on joint negotiations and harm consumers.”

To avoid those problems the NCTA proposed that the FCC impose a number of conditions, including: 

• "No employee or agent of Tegna or CMG/Apollo involved in retransmission consent negotiations may review any retransmission agreement to which the other entity is a party, or receive non-public information with respect to such agreement.
• No employee or agent of Tegna or CMG/Apollo may provide a copy of a station agreement or non-public information regarding such agreement to any employee or agent of the other entity involved in retransmission consent agreements.
• Tegna and CMG-Apollo may not engage common legal counsel or other agents in connection with retransmission consent negotiations.
• Tegna and CMG/Apollo must each maintain in its online public file a list of all other broadcast stations with which it has a sidecar agreement, the licensee of each such station, and whether Tegna or CMG/Apollo has an attributable interest in the licensee.
• As the applicants committed in their June 13 Letter, the FCC should also adopt a merger condition that the “Combined Company, AGM, and CMG . . . will not enter into any Sharing Agreements or other agreements related to programming, operations, or sale of advertising with each other for any station.”
• Any new JSA, LMA, SSA or similar agreement involving Tegna or CMG/Apollo that is not otherwise barred by the immediately preceding condition must be filed in the stations’ online public files and separately in the instant merger docket 30 days prior to taking effect," the NCTA proposed. 

“Adoption of these or similar conditions would be in the public interest and help ensure effective enforcement of the Commission’s ban on joint retransmission consent negotiations,” the NCTA concluded. 

The NCTA letter is available here. 

WASHINGTON—The FCC has given its approval for Terrier Media, a newly formed company owned by Apollo Global Management, to acquire TV and radio stations from both Cox Enterprises and Northwest (NBI Holdings) with the understanding that the deal will be modified to adhere to new newspaper-broadcast ownership rules that came about following recent court proceedings.

The deal would see Terrier Media acquire all of the TV stations licensed to Northwest license subsidiaries for $384 million, as well as broadcast TV and radio stations owned by Cox for $3.1 billion.

When the U.S. Court of Appeals Third Circuit passed down its ruling in the Prometheus IV case dealing with vacated FCC broadcast ownership deregulation efforts, issues arose with the deal. According to the FCC, the parties amended the structure of the transactions to address any concerns that stemmed from the ruling.

However, the changes to the deal are not in place when it would now become official on Nov. 27, but the FCC has issued a 30-day window to allow all parties to become compliant.

“We recognize that the Television applicants may be in violation of certain broadcast multiple and cross-ownership rules following consummation as a result of the Prometheus IV decision,” the FCC’s Media Bureau wrote in its official decision. “However, we believe the unique circumstances of this case, specifically the Television Applicants’ specific commitments in the October 2019 Amendment and the timing of the Third Circuit’s decision, justify a brief 30-day period from consummation to come into compliance with these revised rules.”

Among the ways that the deal is expected to meet the new rules is for Northwest to surrender a license for one of its stations in Syracuse and Yuma not acquired by Terrier Media while also transferring all of the programming to the acquired station in each market. For Cox, Terrier says that it will change the publication frequency of three Cox newspapers in Ohio to three times a week.

The ownership rules weren’t the only objections to Apollo/Terrier’s acquisition of these stations. Multiple organizations, including Common Cause, filed comments saying how the acquisition would be against the public interest and hurt local TV coverage. However, citing its previous approval of the Nexstar-Tribune acquisition, the Media Bureau stated that it believes this acquisition would be in the public interest.

Read the FCC Media Bureau’s full order for more information.

TYSONS, Va.—Apollo has made two different buyout proposals to Tegna so far in 2019; Tegna confirmed the news in a statement released on Wednesday, Aug. 21.

Tegna says that the first buyout proposal from Apollo came via a letter in February, where Apollo said that it was interested in acquiring Tegna, but did not specify a price. Apollo followed up again in June with a new proposal, in which it would combine Tegna with broadcasting assets Apollo is in the process of buying. This proposal would not have resulted in a change of control for Tegna, the company said in its statement.

Apollo is currently in the process of buying the Cox TV stations following Cox Enterprises’ agreement to sell a majority interest in Cox Media Group earlier this year. Cox Media Group owns 13 TV stations and other assets. That deal is valued at $3 billion, per reports.

Tegna said that it does not intend to update the disclosure.

WASHINGTON—Common Cause officially filed a petition on Friday, May 10, to the FCC asking the commission to reject the proposed merger of Apollo Global Management, Cox Enterprises Inc. and Northwest Broadcasting Inc. Common Cause believes that the proposed merger would severely impact local TV coverage, particularly in an area like Dayton, Ohio.

If accepted, the merger would result in Apollo owning 25 TV stations. In a statement from former FCC commissioner, now Common Cause special adviser Michael Copps, he says that past merger history often shows that the quality of news and information can be diminished under private equity control.

In his statement, Copps specifically points out to the impact that could be had in Dayton, where Cox owns the largest TV station, four radio stations and the Dayton Daily News in the area, all of which would be included in the merger.

“The high level of consolidation in Dayton has already led to reporter layoffs and less robust coverage of local news,” reads Copps statement. “People in the Dayton community say they know more about what is going on in other parts of Ohio than they do in their own town. Apollo’s merger won’t do anything to improve the state of local news in Dayton but will likely make it much worse.

“Allowing a private equity firm to control a significant amount of television stations at a time when the broadcast marketplace is already highly consolidated undermines our values of localism, viewpoint diversity and more media ownership by women and people of color. The FCC should block this merger and uphold a framework that gives communities robust sources of local news and information.”

The full petition can be read here.

MONTEREY, Calif.—Apollo Global Management’s Cox Media Group and Northwest Broadcasting deals and Nexstar Media Group’s divestiture of 19 stations to win FCC approval of its Tribune Media acquisition helped to propel merger and acquisition activity in the U.S. broadcast market to $5.1 billion, according to Kagan, a media research group with S&P Global Market Intelligence.

The quarterly deal volume, the highest since the second quarter of 2007, was propelled by Apollo’s $3.1 billion purchase of a majority stake in Cox Media, which included 14 full-power and nine low-power TV stations, four radio stations and a newspaper, as well as its $384 million purchase of a majority stake in Northwest Broadcasting, the researcher said.

The other major M&A activity centered on Nexstar divestitures. The company sold a total of 19 stations in 15 markets for $1.32 billion to E.W. Scripps and TEGNA, a move needed to win regulatory approval for its December 2018 deal to merge with Tribune Media.

Gray Television boosted the quarterly deal total by $45 million with its acquisition of two CBS affiliates, WWNY serving Watertown and upstate New York and KEYC-TV serving southwestern Minnesota, Kagan said.

Radio deal volume for the quarter hit nearly $237 million, half of which involved Cumulus Media.

ATLANTA—Apollo Global Management and Cox Enterprises have struck a deal that will see Apollo acquire a major interest in Cox Media Group’s broadcast television stations across the country. Cox Enterprises, which will retain a minority stake in the stations, will combine with Apollo to create a new company that will operate the stations and be headquartered in Atlanta.

The stations that are part of the acquisition are in most cases local news leaders in their areas, covering nine states and a combined 31 million viewers. The stations, which make up the entirety of Cox Media Group’s television portfolio, include:

• WSB-TV, ABC (Atlanta)
• WFTV-TV, ABC (Orlando, Fla.)
• WRDQ-TV, Independent (Orlando)
• WSOC-TV, ABC (Charlotte, N.C.)
• WAXN-TV, Independent (Charlotte)
• WPXI-TV, NBC (Pittsburgh)
• WHIO-TV, CBS (Dayton, Ohio)
• KIRO-TV, CBS (Seattle)
• WHBQ-TV, Fox (Memphis, Tenn.)
• WHBQ-TV, Fox (Memphis)
• WFOX-TV, Fox (Jacksonville, Fla.)
• KOKI-TV, Fox (Tulsa, Okla.)
• KMYT-TV, My Network (Tulsa)

Cox Media Group also provides programming sales and other operation services for WJAX-TV, CBS, in Jacksonville.

The deal with Cox will also see Apollo take over Cox’s other media platforms in Ohio, which include the newspapers Dayton Daily News, Springfield News-Sun and Journal-News, and radio stations WZLR (95.3 FM and 101.1 FM), WHKO (99.1 FM) and WHIO (95.7 FM and 1290 AM).

Cox has reportedly been looking for a strategic partner for its stations since this past July. With Apollo, Cox says that it will maintain its management and operating structure at the stations.

“We look forward, in collaboration with Cox Enterprises, to supporting the high standards to which each station operates and contributing to the platform’s future growth and prosperity,” said David Sambur, senior partner at Apollo, in the press release.

This transaction will be subject to customary regulatory review and closing conditions.

NEW YORK--Apollo Global Management LLC, a private equity firm, is planning on acquiring 14 regional TV stations from Cox Enterprise, according to Reuters.

The deal would the largest for Apollo, which also tried to unsuccessfully acquire stations from Nexstar and Tribune last year.

Apollo is also seeking to acquire local stations from Nexstar worth about $1 billion; stations that Nexstar plan to jettison following Nexstar’s $4.1 billion acquisition of Tribune. Apollo has also agreed to purchase a dozen stations in the rural northwest from Northwest Broadcasting.

Atlanta-based Cox announced last summer that it planned on putting the 14 stations on the block as it tries to diversify its portfolio.

Cox and Apollo are also in discussions for joint venture agreements for Cox’s WSB-TV station in Atlanta.

The agreement could be announced as early as this week.