It appears that any FCC action on the Nexstar-Media General license transfers will have to wait until the spectrum auction is concluded, absent a waiver the applicants have sought.
The Justice Department on Sept. 2 signaled that the deal was OK on antitrust grounds, with the provision that Nexstar must first divest a handful of stations. Justice vets deals for antitrust issues, while the FCC conducts a broader, public interest, merger review inquiry.
Although the FCC usually coordinates its review with Justice and weighs in soon after, the commission has said that it would not approve any TV station transactions during the spectrum incentive auction involving stations potentially implicated in that auction.
Since Media General indicated its participation in the auction—it was allowed by the FCC to signal, and did signal, that it was applying to be eligible—FCC action on the transfer could provide information from which auction information might be gleaned in violation of the FCC's rule about not disclosing that information to the public.
Nexstar and Media General sought a waiver of that Prohibited Communications Rule in hopes the deal approval would not have to wait until the end of the auction to get a decision. They pointed out that they were unable to file the transfer application before the Jan. 12 deadline for applying to the auction. On Jan. 27, Nexstar announced a deal, trumping the previous agreement between Media General and Meredith.
The FCC has not acted on that waiver request, an FCC source confirmed.
Meredith had argued last January, in saying its deal was better than Nexstar's, that the inability to file the new deal before the auction deadline could hold up approval until the auction was concluded.
The spectrum auction is currently in stage two and, if past is prologue, would likely not end at the earliest for a couple of months and, if it has to go to further stages, possibly not until early 2017.
"Given the potential extension of the incentive auction into next year, and the potentially negative impact on investors, the FCC should grant Nexstar a waiver to close its deal with Media General," said Adonis Hoffman, who chairs Business in the Public Interest, which provides strategic research and analytic services to media companies, including Nexstar, as well as investors, trade associations and professional service firms. "Now that DOJ has cleared any competition / antitrust problems, there is nothing to stop the FCC from allowing the merger to go forward. Aside from the intrinsic merits of the merger, there is an added benefit to minority broadcast ownership, as Nexstar has again divested to a qualified African American buyer as it did with previous mergers."
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