Nexstar-Tegna $6.2B Deal: Layoffs and a Formula for Future Mergers

📺 Todd Stankiewicz: Nexstar-Tegna’s $6.2B merger boosts margins—through layoffs.

Nexstar Media Group’s $6.2 billion takeover of Tegna Inc. has all the makings of a financial triumph for shareholders—and a looming crisis for employees.

Announced August 19, the all-cash deal will pay Tegna investors $22.00 per share, a 31% premium to the broadcaster’s 30-day average stock price prior to reports of the transaction. The merger will create a giant with 265 full-power stations across 44 states, reaching 80% of U.S. television households. Nexstar executives framed the combination as a bold strategy to preserve local journalism while competing with the deep pockets of streaming platforms and Silicon Valley.

“This transaction will… solidify the critical role our stations serve in our communities, preserve their trust, and be better able to compete in today’s highly fragmented media environment,” said Howard Elias, chairman of Tegna’s board, in the release.

But for employees in Buffalo , Cleveland and other cities, where both companies already own multiple stations, the path to “synergies” likely runs through pink slips. Nexstar expects $300 million in annual cost savings, driven by “revenue synergies and net operating expense reductions”.

Cost Savings Mean Job Cuts

Todd Stankiewicz, portfolio manager of the Free Markets ETF (FMKT) and CIO of Sykon Asset Management, was blunt about where those savings come from. “Unfortunately, I think so,” he said when asked whether layoffs should be expected. “That’s where a lot of this cost savings is gonna come from… especially when you’re talking about being in the same exact market as another place”.

He added: “It’s not unique though to communications… This is something that we see with any kind of merger. When we come together, there’s a question of who’s gonna be redundant to the new organization and who’s gonna be essential”.

For Wall Street, redundancy spells opportunity. Nexstar shares have climbed since the FCC rolled back ownership limits, paving the way for consolidation. Stankiewicz noted that investors are betting on efficiency rather than growth: “It’s operational efficiency and cost savings. I don’t know how much there is to capitalize on new revenue streams… The immediate focus is cutting redundancy”.

The timetable for these cuts is measured in months, not years. “Starting around that six to 12 month period, you start to see little subtle changes… Once you start getting to that 12 to 18 month period… you start to see layoffs happen, you start to see scaling back,” Stankiewicz explained.

From an investment standpoint, the logic is clear. Consolidation means higher margins and more free cash flow, allowing Nexstar to pay down debt and deliver returns. For communities, it may mean fewer reporters in the field and less diversity of coverage—even as executives tout their commitment to “the long-term vitality of local news”.

As Stankiewicz suggested, this merger is not the end of the story. Broadcasters like Sinclair and Gray could pursue similar deals, deploying the same playbook of consolidation, cost-cutting, and workforce reductions. The Nexstar-Tegna tie-up is both a test case and a template: a formula where shareholder value is unlocked through coming layoffs, a formula that may well define the next wave of media mergers.

Media analysts note that the deal’s future still hinges on regulatory changes. As Al Tompkins wrote in Poynter on August 19, 2025, “To pull off what would be the biggest change in TV broadcast ownership history, however, the Federal Communications Commission would have to relax rules limiting how much of the country one company can reach with its over-the-air signal.” Whether the FCC follows through may determine not just the Nexstar-Tegna merger, but the shape of future consolidation across the industry.