Nexstar absorbs Tegna to create largest U.S. broadcast company after FCC waives ownership cap

Overview

For two decades, federal law has barred any single company from owning television stations that reach more than 39% of American households. On March 20, the Federal Communications Commission (FCC) waived that rule for the first time, clearing Nexstar Media Group's $6.2 billion acquisition of rival broadcaster Tegna. The combined company now owns 265 stations in 44 states, reaching roughly 80% of U.S. TV households — more than double the legal cap.

The approval came not from the full five-member commission but from the FCC's Media Bureau, bypassing a public vote. Eight state attorneys general immediately sued to block the deal under federal antitrust law, and satellite provider DirecTV filed a separate suit warning the merger will drive up the fees cable and satellite companies pay to carry local stations — costs that get passed to subscribers. The deal closed the same week, meaning any legal challenge now faces the harder task of unwinding a completed transaction rather than preventing one.

Why it matters

If the ownership cap is effectively dead, the next wave of broadcast mergers could leave most local TV news controlled by two or three companies.

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Key Indicators

265

Combined TV stations

Nexstar now owns or operates 265 stations across 44 states and Washington, D.C.

80%

U.S. household reach

The combined company reaches roughly 80% of American TV households, far exceeding the 39% cap

$6.2B

Deal value

Tegna shareholders received $22 per share in cash

5,000%

Retransmission fee increase

Industry-wide retransmission fees grew from $215 million in 2006 to an estimated $11.9 billion in 2025

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People Involved

Perry A. Sook

Leading newly expanded company; contract extended through March 2029

Brendan Carr

Oversaw bureau-level approval of the merger

Rob Bonta

Leading multi-state lawsuit to block the merger

Anna Gomez

Lone Democratic commissioner; publicly opposed the approval process

Organizations Involved

Nexstar Media Group

Broadcast Television Company

Acquirer; now the largest TV broadcaster in U.S. history

The largest local television broadcaster in the United States, now operating 265 stations in 44 states after absorbing Tegna.

Tegna Inc.

Broadcast Television Company

Acquired by Nexstar; ceases to exist as independent company

Formerly the third-largest television station group in the U.S., operating 64 stations before being absorbed into Nexstar.

Federal Communications Commission (FCC)

US Federal Agency

Approved the merger via bureau-level action, waiving the 39% ownership cap

The federal agency that regulates interstate communications, including broadcast television licensing and ownership rules.

Timeline

FCC approves merger, waiving the 39% ownership cap
Regulatory

The FCC's Media Bureau — not the full commission — approved the deal and waived the national ownership cap for the first time, allowing the combined company to reach 80% of U.S. households. The Department of Justice also cleared the transaction.
March 20th, 2026
Eight state attorneys general sue to block the deal
Legal

California, New York, Colorado, Illinois, Oregon, North Carolina, Connecticut, and Virginia filed suit in federal court alleging the merger violates the Clayton Act by substantially lessening competition in local TV markets.
March 18th, 2026
DirecTV files separate lawsuit
Legal

DirecTV sued to block the merger, arguing the combined company would have extraordinary leverage to raise retransmission fees paid by cable and satellite providers.
March 18th, 2026
Trump reverses course, endorses the merger
Political

Trump endorsed the deal on Truth Social, saying it 'will help knock out the Fake News because there will be more competition.' FCC Chairman Carr responded: 'Let's get it done.'
February 7th, 2026
FCC accepts transfer applications
Regulatory

The FCC formally accepted applications to transfer control of Tegna stations to Nexstar, beginning its review process.
December 1st, 2025
Trump initially questions the deal
Political

President Trump wrote on Truth Social that he would 'not be happy' if the merger also allowed networks he considers hostile to expand.
November 20th, 2025
Tegna shareholders approve merger by 98% vote
Corporate

Approximately 98% of Tegna shares voted approved the deal, representing about 83% of total outstanding shares.
November 15th, 2025
Nexstar announces $6.2 billion deal to buy Tegna
Corporate

Nexstar and Tegna announced a merger agreement at $22 per share in cash, which would combine the first- and third-largest U.S. station groups.
August 18th, 2025
Nexstar acquires Tribune Media
Corporate

Nexstar completed its acquisition of Tribune Media, becoming the largest local TV broadcast company in the United States.
September 19th, 2019
FCC blocks Sinclair-Tribune merger over sham divestitures
Regulatory

Even under the business-friendly Pai FCC, the Sinclair-Tribune broadcasting merger was blocked after evidence that proposed station sales were designed to let Sinclair maintain de facto control.
July 16th, 2018
FCC reinstates UHF discount under Chairman Pai
Regulatory

FCC Chairman Ajit Pai reinstated the UHF discount, which counts UHF station audiences at half their actual size for ownership cap calculations, effectively loosening the cap.
April 20th, 2017
Congress caps broadcast ownership at 39%
Regulatory

The Consolidated Appropriations Act sets the national TV ownership cap at 39% of U.S. households, codifying a limit that had been debated since the Telecommunications Act of 1996.
January 23rd, 2004

Scenarios

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Predictions leaderboard

Courts uphold the merger, setting precedent for further consolidation

Federal courts decline to grant injunctions, ruling the FCC had authority to waive the ownership cap or that the states lack standing to challenge an FCC regulatory action. The completed merger stands, and other broadcasters — including Sinclair, Gray Television, and E.W. Scripps — pursue their own large-scale acquisitions, citing the Nexstar precedent. The 39% cap becomes effectively defunct without Congress ever voting to repeal it.

Discussed by: Wall Street analysts and the National Association of Broadcasters, which has urged the FCC to eliminate the cap entirely

Consensus —

Courts block the merger on antitrust grounds, forcing divestitures

A federal judge grants an injunction or rules the merger violates antitrust law, forcing Nexstar to divest stations in overlapping markets. Because the deal has already closed, the unwinding process would be complex and costly. This outcome would signal that FCC approval alone cannot immunize broadcast mergers from antitrust challenges — a significant constraint on future consolidation.

Discussed by: The eight state attorneys general and antitrust scholars who argue the Clayton Act claim is strong regardless of FCC approval

Consensus —

Courts rule the FCC lacks authority to waive the statutory cap

A court finds that Congress set the 39% cap as a statutory requirement in 2004, not a regulation the FCC can waive. This would invalidate the ownership waiver and potentially require Nexstar to divest enough stations to fall below 39% — a far more drastic unwinding than targeted antitrust divestitures. It would also foreclose the FCC's path to loosening ownership rules without congressional action.

Discussed by: The American Television Alliance (ATVA) and legal scholars including those at the Yale Journal on Regulation

Consensus —

Merger survives legal challenges but with conditions that limit Nexstar's leverage

Courts allow the merger to stand but impose conditions — such as extended retransmission fee caps, local news investment requirements, or restrictions on future acquisitions — that blunt Nexstar's market power. The FCC's existing conditions (maintaining retransmission rates through November 2026 and increasing local news) could be extended or strengthened. This outcome preserves the deal while addressing the most acute competition concerns.

Discussed by: Media industry analysts and pay-TV distributors concerned about retransmission fee increases

Consensus —

Historical Context

Sinclair-Tribune merger blocked (2018)

March 2017 – August 2018

What Happened

Sinclair Broadcast Group attempted to buy Tribune Media for $3.9 billion, which would have made it the largest U.S. station group. FCC Chairman Ajit Pai — a Republican appointee generally favorable to deregulation — blocked the deal after discovering that Sinclair's proposed station divestitures were shams designed to let the company maintain control of 'sold' stations through executives with close ties to Sinclair.

Outcome

Short Term

Tribune terminated the merger and sued Sinclair for breach of contract. Sinclair's stock dropped sharply.

Long Term

The failure demonstrated that even a deregulation-minded FCC had limits. Nexstar, not Sinclair, ultimately bought Tribune Media in 2019, becoming the largest station group.

Why It's Relevant Today

The Nexstar-Tegna deal succeeds where Sinclair-Tribune failed, but through a different mechanism: rather than proposing questionable divestitures to stay under the cap, Nexstar persuaded the FCC to waive the cap entirely — a more aggressive regulatory approach than even the Sinclair deal attempted.

Clear Channel radio consolidation (1999–2008)

1999 – 2008

What Happened

After the 1996 Telecommunications Act lifted radio ownership caps, Clear Channel Communications acquired over 1,200 radio stations nationwide, including its $17.4 billion purchase of AMFM Inc. in 1999. The company went from 40 stations to controlling roughly 10% of all U.S. radio stations and captured a third of all radio advertising revenue.

Outcome

Short Term

Local radio programming was widely replaced by centralized, nationally syndicated content. Hundreds of local radio jobs were eliminated.

Long Term

Clear Channel went private in a $26.7 billion leveraged buyout in 2006, was renamed iHeartMedia, and filed for bankruptcy in 2018 with $16 billion in debt. The episode became a cautionary tale about debt-fueled media consolidation.

Why It's Relevant Today

The closest precedent for what the Nexstar-Tegna merger could mean for local television. Radio consolidation after 1996 showed how lifting ownership caps can rapidly concentrate an industry — and how the debt taken on to fund acquisitions can become unsustainable.

FCC's 2003 attempt to raise the ownership cap (2003–2004)

June 2003 – January 2004

What Happened

FCC Chairman Michael Powell pushed through new rules raising the national ownership cap from 35% to 45%. The decision triggered a rare bipartisan backlash in Congress, with both Republicans and Democrats objecting to media concentration. Over three million public comments opposed the change — at the time, the largest public response to any FCC proceeding in history.

Outcome

Short Term

Congress passed legislation in January 2004 rolling the cap back to 39% — a compromise between 35% and 45%.

Long Term

The 39% cap was written into statute, and Congress removed the FCC's ability to revisit it in its regular quadrennial ownership reviews, intending the number to be permanent.

Why It's Relevant Today

The current FCC's waiver of the 39% cap achieves through regulatory action what Congress explicitly rejected in 2003–2004. Whether the FCC has authority to waive a cap that Congress set by statute is the central legal question in the pending lawsuits.