Standard General tells Tegna employees ‘no intention to cut staff’

Standard Media CEO Deb McDermott tried to quell rumors and concerns that when and if her company resumes Tegnathe new company could reduce its workforce.

In a highly unusual move during a takeover, and with takeover approval still in the hands of the Federal Communications Commission, McDermott sent a memo to Tegna workers that included a bolded paragraph to emphasize:

You may have read comments in the press from groups opposed to the deal speculating that Standard General will cut journalism and lay off reporters at company stations. These comments are simply untrue.

Standard General and I have always placed a high value on local journalism and do not intend, and have never intended, to cut TEGNA stations’ news or news staff. In fact, and as we have represented to the FCC, we do not intend to reduce staff at the station level as a result of the transaction.

On the contrary, we expect vigorous competition in all markets, which will require continued investment in local journalism and newsgathering operations.

Our commitment to journalism has been supported by both Standard General and myself at major local broadcast groups over the past 12 years, including those at Young Broadcasting, Media General and, most recently, Standard Media Group.

The CEO’s email follows what Standard General – the investment firm that owns Standard Media – calls a “baffling” review by the FCC. The FCC requested detailed information about Standard General’s plans for staffing and serving the public interest, and how it plans to handle retransmission agreements with cable and satellite companies. The FCC has issued a protective order this would require the company to send confidential information to the government that would not have to be made public.

Groups including Common cause, the NewsGuild-CWAand Public Knowledge openly opposed the takeover and asked the FCC to delay approval.

Speculation that Standard General could cut staff may be rooted in the sticky war of words. General Chief Standard Soo Kim was critical of Tegna’s leadership, even attempting to buy the company. In April 2020, Standard General launched a detailed attack on Tegna’s profitability which included a reference that worried Tegna employees. He posted this chart, in which he said Tegna stations have “2x the number of employees per station compared to their peers,” but lag behind their peers in terms of profitability.

(General SEC Standard Filing, April 13, 2020)

Standard General didn’t say Tegna was overstaffed, but the comparison was troubling to employees watching what happened in the newspaper industry when private equity fund managers took over companies. media and cut staff. Industry watchers point out that Tegna stations are mostly found in larger markets than their industry counterparts, although Nexstar and Gray have both added large market stations to their portfolios in recent years.

In his e-mail, McDermott does not say categorically that there will be Nope layoffs or staff reductions – no one can make such predictions – but she said her own track record as a media manager showed her dedication to journalism:

Having been a station general manager and having worked with newsrooms for over 30 years, I firmly believe that strong local journalism is a critical component to the success of a local broadcast station.

While I will have much more to share with you in the future about our post-closure plans, I wanted you to hear these points from me and reiterate our commitment to building on the many successes you have already achieved. I look forward to meeting you in person in the future and working with all of you to create new opportunities for the Society.

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