Tribune Media Co. said Thursday it has terminated the $3.9 billion deal to be acquired by Sinclair Broadcast Group Inc., originally announced in May 2017, and said it has sued Sinclair for breach of contract. Tribune’s stock was still inactive in premarket trade. As part of the deal, Sinclair committed to use “reasonable best efforts” to obtain regulatory approval, including agreeing to divest stations in certain markets as necessary, but instead Tribune alleges that Sinclair engaged in “unnecessarily aggressive and protracted negotiations” with regulators, and refused to sell some stations required for approval. The Federal Communications Commission concluded that Sinclair may have misrepresented or omitted material facts to circumvent ownership rules, Tribune said. “In light of the FCC’s unanimous decision, referring the issue of Sinclair’s conduct for a hearing before an administrative law judge, our merger cannot be completed within an acceptable timeframe, if ever,” said Tribune Chief Executive Peter Kern. The stock had tumbled 21% year to date through Wednesday, while the S&P 500 had gained 6.9%.
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