The daily business briefing: May 9, 2017
Sinclair agrees to buy Tribune Media for $3.9 billion, Facebook takes on fake news ahead of U.K. elections, and more
Sinclair confirms deal to buy Tribune Media for $3.9 billion
Sinclair Broadcasting, already the largest U.S. owner of local television stations, confirmed Monday that it had agreed to buy Tribune Media for $3.9 billion. Sinclair beat out other interested companies that included Nexstar and 21st Century Fox. With the addition of Tribune's 42 stations, Sinclair will have 173 stations and be able to reach more than 70 percent of American households, including those in Chicago, Los Angeles, and New York. Tribune CEO Peter Kern said the deal was the start of a wave of consolidation that will "better allow local broadcasters to compete." Critics said the acquisition will give Sinclair too much power to advance a conservative agenda.
Facebook makes push against fake news ahead of U.K. elections
Facebook published ads in British newspapers on Monday offering advice on spotting fake news online. The move was part of a push to weed out misinformation on the social network ahead of general elections in the U.K. next month. Facebook has faced heated criticism over its role in spreading fake news during the U.S. presidential campaign last year. The company announced last week that it was hiring 3,000 more moderators, nearly doubling its staff devoted to ferreting out bogus posts.
Gas prices edge down ahead of busy summer travel season
Gas prices typically rise as the summer travel season begins, but this year pump prices are dropping ahead of Memorial Day weekend, when Americans start hitting the road. The Energy Information Administration reported Monday that the nationwide average price had fallen to $2.37, dropping from $2.41 over the last week. The trend comes as oil prices have faced pressure from slowing demand and rising U.S. output, which has countered the effect of production cuts under a deal by OPEC and non-OPEC exporters.
Coach to buy Kate Spade for $2.4 billion
Coach announced Monday that it had reached an agreement to buy handbag maker Kate Spade for $2.4 billion as the industry struggles with discounts needed to contend with toughening competition. Coach's offer of $18.50 per share for Kate Spade represented a 9 percent premium on the stock's Friday closing price. The acquisition, rumored for months, will allow Coach to broaden its customer base, offering its own leather handbags with embossed logos as well as Kate Spade's colorful, kitschy accessories, including handbags in the $100 to $500 range. The move comes as Coach backs away from flooding major department stores with its wares, which analysts said devalued the brand.
Bumble Bee agrees to $25 million fine for tuna price fixing
Bumble Bee Foods has agreed to plead guilty to fixing canned tuna prices in the U.S., the Justice Department said Monday. The company will pay a $25 million fine. Two Bumble Bee executives entered guilty pleas in the case last December, and they are now on paid leave. The Justice Department said in the complaint that Bumble Bee executives met with counterparts from other, unnamed companies from 2011 to 2013 "to fix, raise, and maintain prices of packaged seafood." Bumble Bee said it had "fully cooperated" with investigators and had "established strong guidelines and new internal policies for our path forward."