As the local TV giant Nexstar seeks to expand its reach with its $6.2 billion TEGNA acquisition, the union that represents some of its employees is planning to foment a shareholder revolt.
The Communications Workers of America, which represents hundreds of workers at Nexstar-owned TV stations through the National Association of Broadcast Employees and Technicians, said Monday that it intends to propose five “governance proposals” at Nexstar’s upcoming annual meeting, and will solicit shareholder approval for them.
The CWA has been a vocal opponent to Nexstar’s TEGNA deal, arguing that it will result in a paring back of local news and jobs in the markets in which it owns multiple stations. But the deal has secured the approval of President Donald Trump, who wrote that it would create “more competition against THE ENEMY, the Fake News National TV Networks.”
FCC Chairman Brendan Carr has also indicated he supports the deal, though the legality over whether the FCC can unilaterally raise the 39 percent TV station ownership cap is not entirely clear.
The CWA’s proposals would change the rules around calling special meetings and nominating directors, and proposals for securing shareholder approval on major M&A, and for the board to create an independent chairman, or at the very least name a lead independent director (Perry Sook is currently chairman and CEO).
A spokesperson for Nexstar declined to comment.
“Nexstar’s board lacks independent leadership from Chair and CEO Perry Sook, contributing to a record of governance problems that are harmful to shareholders,” NABET-CWA President Charlie Braico said in a statement. “Despite strong shareholder support for an independent board chair, the company has delayed implementation of this policy as a condition of its employment agreement with Sook and the board has not even appointed a lead independent director. Now company leadership is engaged in empire-building through the proposed TEGNA transaction to the detriment of shareholders. These management problems extend to labor relations as well – Nexstar has repeatedly engaged in frivolous appeals, wasting resources rather than complying with administrative and court decisions requiring it to recognize its workers’ unions at multiple locations. By advancing an independent solicitation, we can ensure shareholders are afforded their right to a voice on the Company’s governance shortcomings.”
