FCC's Ajit Pai Won't Approve Sinclair Merger, Refers for Hearing

FCC Chairman Ajit Pai said that he has "serious concerns" about Sinclair Broadcast Group's plans to merge with Tribune Media, adding that the agency cannot approve the transaction as is.

He wants the merger to be sent to an administrative law judge for review.

"Based on a thorough review of the record, I have serious concerns about the Sinclair/Tribune transaction," Pai said in a statement. "The evidence we've received suggests that certain station divestitures that have been proposed to the FCC would allow Sinclair to control those stations in practice, even if not in name, in violation of the law."

The statement continued, "When the FCC confronts disputed issues like these, the Communications Act does not allow it to approve a transaction. Instead, the law requires the FCC to designate the transaction for a hearing in order to get to the bottom of those disputed issues. For these reasons, I have shared with my colleagues a draft order that would designate issues involving certain proposed divestitures for a hearing in front of an administrative law judge."

The $3.9 billion transaction that would create an unprecedented giant in local broadcasting, as Sinclair would be the largest owner of stations with a reach of almost 59 percent of the country.

Under the plan, Sinclair would ultimately own 215 stations in 102 markets.

Sinclair's effort to acquire the Tribune stations has been contentious, drawing opposition not just from an array of public interest groups but some cable industry trade associations as well as conservative news outlets like Newsmax, One America News Network and TheBlaze. On Thursday, the group Free Press dispatched a truck that displayed video images of John Oliver and others warning of the merger.

But Sinclair also has had to revise its plans to divest stations to comply with the FCC media ownership cap, which limits broadcast holdings to no more than 39% of the country. In April, Sinclair outlined a list of 23 outlets it plans to sell, but critics said the company would continue to have influence over a number of the divested stations.