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Sinclair Amends Tribune Deal...Again

In a move likely in response to the Justice Department, Sinclair has once again amended its June 2017 deal to purchase Tribune Media's stations, this time adjusting last week's amended filing to cut Harrisburg-Lancaster-Lebanon-York (Pa.) from the markets where it sought to own two of the top four stations to take advantage of the FCC's new case-by-case waiver of the prohibition on such ownership.

Sinclair will now sell one of the two stations in that market rather than try for an exemption.

That is according to a copy of the amended filing obtained by B&C/Multichannel News. Sinclair declined comment on what had changed, but Harrisburg had been moved out of the section on markets were Sinclair is seeking to own two of the top four stations to the bucket for "Overlap Markets where Sinclair is divesting stations to comply with the Duopoly Rule."

Related: Sinclair Resubmits Amended Tribune Deal

It is a fairly safe bet that deciding to sell one of the Harrisburg stations instead of trying to hold onto both was at the behest of the Justice Department, whose antitrust review looks at share of ad revenue in a market. That may have been the holdup in the DOJ review of the deal, a decision on which had been expected by now.

Sinclair is still seeking FCC permission to own two of the top four in only Greensboro-High Point-Winston Salem, N.C., and Indianapolis, but reducing the number of such reviews from three to two could speed the FCC's review, which goes beyond antitrust and ad share to public-interest benefits.

One other change to the amendment filed last week is that Sinclair wants the FCC to grant it a waiver to operate the stations in Greensboro and Indianapolis under a waiver until it has decided whether it can own both stations in both markets, rather than put them in a trust pending that decision, as last week's amendment had proposed. The stations were no longer in the "trust" section of the amended filing.

Operating the stations under a waiver would make it easier that having to extricate them from the trust if the FCC exempts those markets from its prohibition on owning two of the top four stations.

Sinclair outlined in the new filing its request to operate the stations in Greensboro and Indianapolis under a waiver rather than put them in a trust: "Sinclair is requesting Commission consent to own two Top-Four Stations in (i) Greensboro-High Point-Winston Salem and (ii) Indianapolis, Indiana. In the event that Sinclair is not permitted to own two Top-Four Stations in each of the Greensboro-High Point-Winston Salem and Indianapolis, Indiana DMAs, Sinclair hereby requests temporary waivers to operate the stations in these markets following closing of the Transaction as may be necessary to divest one of the Top-Four stations in each of these markets in an orderly manner. Additionally, as detailed below, because Sinclair will be required to divest one of the three stations in the Greensboro DMA but will not know which station until the Commission completes its review, Sinclair hereby requests a temporary waiver of the Duopoly Rule to operate three stations in the Greensboro DMA to give Sinclair a reasonable period of time to make the required divestiture."

Presumably, this filing will result in the FCC restarting its merger review clock on the deal, which was paused in anticipation of the amended filings, which the FCC prompted by its November vote to loosen local ownership rules and potentially permit Sinclair from retaining more of the Tribune stations.

Sinclair last week resubmitted its $3.9 billion deal to acquire Tribune’s stations to the FCC, even as it continued to negotiate some of the proposed station spinoffs with the Justice Department, adjusted to reflect the media deregulation it pushed for. The original deal, proposed in May of 2017, would have given Sinclair control of Tribune’s 42 stations, in addition to the 193 stations Sinclair already owns or operates, with some tweaking necessary under old and new FCC rules.

Sinclair’s filing last week signaled that the deal will not be closing in the near-term, given that the DOJ is still vetting it and the FCC will now have to put the new deal out for public comment and consider that feedback before it decides.

The FCC last month paused its review of the deal, and its informal 180-day shot clock (on day 167, the second such pause in the Sinclair-Tribune review), in anticipation of the refiled, and now again refiled, amended deal.