FCC Clears Way for ION Media Buyout

The Federal Communications Commission approved the transfer of Ion's 60 television station licenses to Citadel Investment Group Monday, saying the transaction will "serve the public interest."

A group of Ion investors filed a complaint with the FCC claiming that NBC, is trying to control Ion through a partnership with Citadel that violates media ownership rules.

The complaint delayed a key step in the buyout, which involved NBC Universal transferring to Citadel its stake in Ion, formerly known as Paxson Communications. In announcing its takeover bid in May, Citadel said it would invest $100 million into Ion.

Unhappy investors, including Paxson founder Lowell Paxson, also filed two civil suits this summer, seeking to block Ion's bid to go private.

It was not immediately clear how the ruling would affect the civil suit.

While a majority of the FCC's commissioners had no reservations about the transaction, Commissioner Michael Copps raised concerns about a hedge fund running a television network.

"We do not know the identity of the investors in this particular fund, and we do not know how this fund has treated other companies it has owned in recent years," Copps said in a statement.

The Citadel Web site refers to the company as a "sophisticated alternative investment institution."

Representatives from Citadel and Ion could not be reached Monday evening.