Sinclair proposes buying WGN in latest move to win FCC approval of Tribune deal

Sinclair Broadcast Group wants to buy Chicago's WGN-TV outright as part of its latest effort to win the Federal Communications Commission's approval for its proposed acquisition of Tribune Media Co. In addition to buying WGN, Sinclair plans to put stations in Dallas and Houston into a divestiture trust to be operated by an independent third-party trustee. Sinclair had previously proposed selling the Texas stations to Cunningham Broadcasting Corp. and WGN to an entity called WGN-TV LLC. Sinclair had included service agreements in the deals allowing the company to continue to run the stations. Cunningham was controlled by the estate of Sinclair chairman David Smith's mother. WGN-TV LLC's president is Steven B. Fader, a business partner of Smith in Atlantic Automotive Corp. which owns dozens of car dealerships in Greater Baltimore.

"There can be no question regarding misrepresentation or character given that Sinclair has fully disclosed all terms of all aspects of the transactions it has proposed," Sinclair said. "The FCC's reported concerns with sales to certain parties have been eliminated in light of the withdrawals of the applications relating to Dallas, Houston, and Chicago. Accordingly, we call upon the FCC to approve the modified Tribune acquisition in order to bring closure to this extraordinarily drawn-out process and to provide certainty to the thousands of Tribune employees who are looking for closure."

Robert McDowell, a former FCC commissioner who is now an attorney at Cooley LLP, said Sinclair could actually end up coming out ahead as a result of addressing the specific problems identified by Pai. "What was noteworthy about this hearing designation order is that it was pretty specific regarding what defects it perceived needed to be cured," McDowell said. "The HDO could have the effect of pushing Sinclair into accepting terms it was resisting previously. If Sinclair complies with the FCC’s wishes, it could get more than half of the loaf it was pursuing in the first place."