Nexstar Stock Drops Sharply After Judge Puts Brakes On Tegna Merger
Deadline • • business
Key Points:
- Nexstar stock dropped 13% on Monday after a federal judge issued a temporary restraining order blocking its $6.2 billion merger with Tegna, erasing nearly $850 million in market value and pushing shares to their lowest since last November.
- U.S. District Judge Troy Nunley sided with DirecTV, which argues the merger violates antitrust laws, and a group of states including California and New York also oppose the deal; a hearing is scheduled for April 7.
- The merger, which was approved by the FCC using a waiver to allow ownership of stations reaching about 80% of the U.S., far exceeding the usual 39% cap, is now facing potential lengthy legal delays.
- Analysts warn that Nexstar could be stuck in prolonged legal uncertainty, with the case possibly reaching the U.S. Supreme Court as late as 2028-29, while Nexstar shareholders bear ongoing risks and Tegna shareholders have already been paid.
- FCC Chairman Brendan Carr supports the merger as a way to counter national networks' influence over local broadcasters, but legal experts caution that the case will clarify the antitrust boundaries of broadcast consolidation beyond political considerations at the FCC.
