Judge temporarily halts US local TV group Nexstar’s $6.2bn acquisition of Tegna

A federal judge in California has temporarily blocked Nexstar Media Group’s proposed US$6.2bn takeover of fellow TV station group Tegna and ordered the companies to cease all integration plans while a legal challenge to the deal plays out.

Perry Sook

US district judge Troy Nunley on Friday issued a preliminary injunction, ruling there was a “reasonable probability” the deal would have an “anti-competitive effect.”

The injunction comes less than three weeks after Nunley issued a temporary restraining order when DirecTV and eight states sued to block the deal on antitrust grounds.

With the injunction coming into effect on April 21, Nexstar will be forced to keep Tegna’s station groups separate from its own for the duration of the legal proceeding.

The combination of Nexstar and Tegna creates a behemoth in US local TV, with around 260 TV stations in 44 states.

Prior to the deal, Nexstar controlled more than 200 local stations in 116 markets and reached around 220 million consumers across the US, while Tegna owned more than 60 local stations in 51 markets. If the court case finds that a Nexstar-Tegna combination is anticompetitive, they would be forced to unwind the deal.

The eight states and DirecTV have argued the merger would drive up the cost of television services to tens of millions of Americans, result in the closure of local newsrooms and reduce competition in markets across the country, as well as hurting consumers.

Nexstar, which is led by CEO Perry Sook, responded on Friday by saying the deal was a “pro-competitive transaction” and vowing to challenge the injunction.

“This transaction closed more than four weeks ago following receipt of all required regulatory approvals from the Federal Communications Commission and the US Department of Justice,” it said.

“Nexstar Media Group now owns Tegna and has taken steps consistent with the court order that has been in effect. For nearly 30 years, Nexstar has provided free over-the-air access to all its broadcast stations – local news, weather, and community-focused programming alongside major network programming. This pro-competitive transaction will make local stations stronger and support continued investment in local journalism and fact-based news.

“We will appeal today’s decision and look forward to presenting our case on its merits before the Ninth Circuit Court of Appeals.”