Nexstar-Tegna merger paused after judge issues temporary restraining order

The US$6.2bn mega-merger between US station group Nexstar Media and smaller rival Tegna has been put on hold after a federal judge imposed a temporary restraining order (TRO).

Perry Sook

California District Judge Troy Nunley on Friday granted a 14-day TRO after DirecTV had made a challenge alleging the deal was anticompetitive. Another hearing is set for April 7 when the TRO expires.

“Plaintiff asserts Nexstar’s proposed merger with Tegna will drive up the cost of television service to tens of millions of Americans, shutter local newsrooms around the country, substantially reduce competition in dozens of local markets and harm consumers,” said Nunley in his ruling.

Earlier this month, Nexstar Media Group announced that its takeover of Tegna had closed after it received regulatory approval from the US Federal Communications Commission (FCC) and the Department of Justice.

The announcement from Nexstar and the FCC came around 24 hours after eight US states, including California and New York, sued to block the deal on antitrust grounds.

Separately, DirecTV sued to block the deal, alleging it would enable Nexstar to hike prices for pay TV companies to retransmit the merged entity’s channels. DirecTV also said approval of the deal would lead to Nexstar closing local newsrooms in “dozens” of markets.

The deal has the support of US president Donald Trump, who has said it would help in his fight against “the Fake News National TV Networks.” Last month, Trump wrote on Truth Social: “Letting Good Deals get done like Nexstar-Tegna will help knock out the Fake News because there will be more competition, and at a higher and more sophisticated level. Those that are opposed don’t fully understand how good the concept of this Deal is for them, but they will in the future.”

The combination of Nexstar and Tegna would create 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.

Perry Sook, Nexstar’s founder, chairman and CEO, said the deal is “essential to sustaining strong local journalism in the communities we serve” and that it would make the company “a stronger, more dynamic enterprise – better positioned to deliver exceptional journalism and local programming with enhanced assets, capabilities and talent.”