Justice Department Requires Substantial Divestitures in Gray’s Acquisition of Quincy to Protect American Consumers and Small Businesses
Gray and Quincy Must Divest 10 Broadcast Television Stations in Seven Local Markets
The Department of Justice announced today that it will require Gray Television Inc. and Quincy Media Inc. to divest 10 broadcast television stations in seven local markets as a condition of resolving a challenge to Gray’s proposed $925 million acquisition of Quincy.
The Justice Department’s Antitrust Division filed a civil antitrust lawsuit in the U.S. District Court for the District of Columbia to block the proposed merger. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the suit by remedying competitive harms alleged in the complaint, through the divestitures and related conditions.
“Without the required divestitures, Gray’s acquisition of Quincy threatens significant competitive harm to cable and satellite TV subscribers and small businesses that advertise on broadcast television,” said Acting Assistant Attorney General Richard A. Powers of the Justice Department’s Antitrust Division. “I am pleased that we have been able to reach a complete resolution of the department’s concerns, thanks in part to the parties’ commitment to engage in good faith settlement talks from the outset of our investigation.”
According to the complaint, without the divestitures the merger would eliminate head-to-head competition between Gray and Quincy broadcast television stations in seven local markets, which are centered in: Tucson, Arizona; Rockford, Illinois; Cedar Rapids, Iowa; Paducah, Kentucky; Eau Claire, Wisconsin; Madison, Wisconsin; and Wausau, Wisconsin.
The combined company likely would charge cable and satellite companies higher retransmission fees to carry its broadcast television stations in those local markets, resulting in higher monthly cable and satellite bills for millions of Americans. The merger also would enable the combined company to charge local businesses higher prices to advertise on its broadcast television stations in those local markets.
Under the terms of the proposed settlement, Gray and Quincy must divest 10 broadcast television stations to Allen Media Holdings LLC or an alternative acquirer approved by the United States. Allen Media currently owns and operates 14 broadcast television stations in 12 local markets.
Gray is a Georgia corporation with headquarters in Atlanta, Georgia. Gray owns 165 television stations in 94 local markets. In 2020, Gray reported revenues of $2.4 billion.
Quincy is an Illinois corporation headquartered in Quincy, Illinois. Quincy owns 20 television stations in 16 local markets. In 2020, Quincy earned revenues of approximately $338 million.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Scott Scheele, Chief, Media, Entertainment, and Communications Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street NW, Suite 7000, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may enter the final judgment upon finding it is in the public interest.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.