Nexstar says it has acquired Tegna as state AGs push to block the merger

By Brian Stelter, CNN

(CNN) — Nexstar says it has completed its acquisition of Tegna, uniting two of the largest TV station ownership groups in the United States.

But the deal still faces legal scrutiny: Eight state attorneys general have filed an antitrust lawsuit to block the acquisition.

The state officials, led by California Attorney General Rob Bonta, say the merger will hurt consumers by hiking prices and weakening local news coverage.

Nexstar CEO Perry Sook says otherwise: “This transaction is essential to sustaining strong local journalism in the communities we serve.”

The big broadcasting merger provoked grave concern from media watchdog groups when it was announced last August, but it was viewed as inevitable by Wall Street analysts who have forecast further consolidation in the beleaguered broadcast TV business.

Sook personally courted President Donald Trump as Nexstar sought the administration’s approval for the deal.

Those approvals were announced on Thursday afternoon, leading Nexstar to immediately say that it has “closed,” or completed, the deal.

Sook thanked Trump and the administration “for recognizing the dynamic forces shaping the media landscape and enabling this transaction to move forward.”

Nexstar said nothing about the pending lawsuits in its statement. The state attorneys general complaint was filed late Wednesday in the Eastern District of California and was followed on Thursday by another lawsuit from DirecTV, a leading satellite TV distributor.

The state AG lawsuit will continue, a spokesperson for Bonta confirmed to CNN.

The lawsuit is the latest instance of Democratic state attorneys general acting as a counterweight to Trump, who publicly endorsed the Nexstar deal last month.

The attorneys general of California, New York and Illinois emphasized the sprawling nature of Nexstar and Tegna’s combined footprint, which entails stations in 44 states, during a Thursday morning press conference.

“This merger is illegal, plain and simple, running contrary to federal antitrust laws that protect consumers,” Bonta said.

Bonta, New York AG Letitia James and Illinois AG Kwame Raoul argued that the Nexstar-Tegna deal threatens local journalism, noting recent layoffs at Nexstar-owned newsrooms in Los Angeles, Chicago, and New York.

“We all benefit when local newsrooms compete to break stories, investigate wrongdoing, and keep the public informed – and that is exactly what this merger puts at risk,” James said.

Bonta said the merger would be a “gut punch to a thriving democracy that relies on an informed population.”

Bonta has also vowed to “vigorously” review Paramount’s pending deal to take over Warner Bros. Discovery, the media giant that owns CNN.

Raoul said “consumers and communities will have less choice in news and less access to diversity in perspectives.”

The state-level suit stood in stark contrast to the federal government’s posture toward the deal.

Trump, who sounded skeptical of the Nexstar-Tegna combination last fall, changed his tune in February when he wrote on Truth Social that Nexstar’s acquisition “will help knock out the Fake News because there will be more competition, and at a higher and more sophisticated level.”

There will, by definition, be less actual competition in markets like Denver, Seattle and Dallas.

For Nexstar to take over Tegna, the FCC had to grapple with the national TV ownership rule, which prevents a single company from owning stations that reach more than 39 percent of all US TV households.

Trump’s ally atop the FCC, Brendan Carr, had said he wants to raise the cap, and said the president was “exactly right” to support the Nexstar deal last month. “Let’s get it done,” Carr wrote.

The coalition of state attorneys general highlighted the Trump administration’s support for the deal, with Bonta saying that “leaves it to us to take these important steps.”

Nexstar navigates Trump-era politics

Sook worked overtime to appeal to Trump, billing his company as “the anti-fake news” and going on Maria Bartiromo’s Fox Business show to praise Trump’s policies. Media observers asked whether new MAGA-friendly talk shows on the Nexstar-owned NewsNation cable channel were also partly a way to appeal to the president.

But the Nexstar-Tegna deal also created a schism in conservative media, with Newsmax and One America News Network lobbying hard against the deal.

Nexstar’s pursuit of Trump administration approval for the deal became national news last fall when Carr publicly condemned ABC late-night host Jimmy Kimmel, and Nexstar almost immediately yanked Kimmel’s show from its ABC-affiliated stations.

Nexstar denied being influenced by Carr’s comments, but the perception that it capitulated in the face of Trump administration pressure provoked widespread criticism. Nexstar restored Kimmel’s show on its ABC-affiliated stations in a matter of weeks.

Carr “has ignored the law and the facts of this merger, promising to get it done for President Trump while pressuring newsrooms to warp their coverage of the administration,” Matt Wood, general counsel for the media reform group Free Press, said in a statement.

Alluding to the Kimmel controversy, Wood said “Nexstar has been all too willing to comply with Carr’s bullying if it means getting this deal done and cementing its domination over the local airwaves.”

But Nexstar and its allies argued that broadcast consolidation is necessary so that station owners can compete with much bigger streaming and social media platforms.

Carr made similar comments while announced that he had OKed the deal on Thursday afternoon.

He said the national TV ownership rule had been waived in this case, “consistent with longstanding FCC authorities.” Media reform advocates said the waiver will likely trigger a legal challenge.

Anna Gomez, the lone Democratic commissioner at the FCC, condemned what she called the “closed door” approval of the deal, which happened without a full commission vote.

“The consequences of this rubber stamp approval will be felt in living rooms and newsrooms across the country, resulting in fewer voices, less competition, and higher costs for consumers,” Gomez said.

Sook, however, insisted in his statement that “by bringing these two outstanding companies together, Nexstar will be a stronger, more dynamic enterprise — better positioned to deliver exceptional journalism and local programming with enhanced assets, capabilities, and talent.”

This story has been updated with additional context and developments.

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