Standard Battles Tegna Deal Retrans Questions
Standard General continues to battle retransmission consent concerns about its proposed buy of Tegna, according to releases and FCC filings this week. Standard Thursday touted a retrans deal with Comcast as evidence of its willingness to comply with conditions on the transaction (see 2212190063), while MVPD Dish sent the FCC a completely redacted retrans letter from Cox Media Group – owned by deal participant Apollo Global Management -- in response to Cox’s denial (see 2212130061) it had sought to include Tegna stations in retrans negotiations. An FCC comment period on Standard’s proposed conditions is set to end in late January, just weeks before a Feb. 22 milestone in the Standard/Tegna merger agreement that would allow Tegna to choose to exit the deal.
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“Standard General and TEGNA’s largest cable group, Comcast Cable Communications, entered into an agreement confirming the application of the TEGNA RCA [retransmission consent agreement] upon closing of the transaction,” said a news release from Standard Thursday. Standard promised the FCC earlier this month it would waive retransmission contract terms that would use after-acquired clauses to raise retrans rates for stations currently owned by Tegna. Since the proposed Standard/Tegna deal involves transferring stations from Tegna to Cox Media Group and then to Standard, retrans rates for those stations would have risen to match Cox’s rates without the waiver.
According to Standard’s release, Comcast agreed to the Tegna rates Tuesday, though Comcast didn’t comment when asked for confirmation. Critics of Tegna’s concession have noted retrans contracts last a maximum of three years and contracts between Tegna and various MVPDs likely all expire at different times, meaning some could end in months. "Standard General welcomes this agreement and looks forward to continue working with its MVPD partners and other stakeholders in building a bright, secure future for local broadcasting in America,” said the Standard release.
Dish, meanwhile, weighed in on allegations from unions opposed to Standard/Tegna that Cox had sought to include Tegna stations in retrans negotiations with the MVPD. Cox and Standard, though, have said there will be no information sharing or joint negotiation between the companies. Cox has said it never sought to negotiate retrans for another company’s stations. The “relevant demand” is in a term sheet Dish received from Cox in November, said Dish in a letter to the FCC Wednesday. The letter includes the term sheet as an exhibit, but the redacted public version has no text visible but page numbers. Dish’s filing doesn’t say if the attached term sheet supports Cox’s denial. The letter says the term sheet is intended to provide the FCC with “the facts underlying a dispute that has arisen between two parties to this proceeding” but states the position of Cox and the unions without publicly saying which one is borne out by the term sheet. Dish, Cox and Standard didn’t comment on the letter.
A comment cycle at the FCC on Standard’s retrans concessions and a separate promise to preserve jobs ends Jan. 20, leaving roughly a month until the Feb. 22 “outside date,” defined in the merger agreement as a point at which the companies could choose to dissolve the deal if it hasn’t been approved. The outside date was originally in November, but Tegna agreed to extend it. Depending on the circumstances, the deal's end could lead to one of the companies paying a termination fee of up to $272 million, according to the merger agreement.