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Atlantic to be Liquidated
- Thread starter OC3
- Start date
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Actually a dose of religious broadcasting would be a good move for South Jersey. If this group went into the Delaware shore, I'll bet they'd be interested in these properties that they will probably be able to get with pennies on the dollar.
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Hey and maybe the Easter bunny channel and Tooth Fairy channel too !
By the way, the number of your last post is also the number of the beast.. (cue scary music) wooooo woooooooooooo :
Actually a dose of religious broadcasting would be a good move for South Jersey. If this group went into the Delaware shore, I'll bet they'd be interested in these properties that they will probably be able to get with pennies on the dollar.
[/quote]
Hey and maybe the Easter bunny channel and Tooth Fairy channel too !
By the way, the number of your last post is also the number of the beast.. (cue scary music) wooooo woooooooooooo :A Buddhist walks up to a hot dog stand and say's....make me one with everything.
M
MickeyD
Guest
OC3 said:
That might be the problem. You can't make money with a station if you have incredible debt. The size of the note shouldn't really have any bearing on the sale price of the station. Besides food and commodities, what has held it's value over the past few years?
I don't think the question is can you make money, the question is how are you payig on your note each month. If this group of stations were owned outright they would be bringing in money.
Look at the Hubbard deal. They bought a group at a multiple of 8X. If I were buying such a group and assumed that radio is on the decline I would probably have tried to negotiate a decleinign revenue base towards the 8th year and get teh stations for a bit less.
Well, there's "declining ad revenue" and there's "mismanagement" - I think Atlantic's demise is due to a little of both. The money guys looked at radio as a license to print money, then tried to run the operation; surprise, there's more to owning a radio station than owning it. The economic downturn just made it into a perfect storm scenario.
SO whats the lesson to be learned from this mess is not to let a hot dog sales man with no radio management experince run your business.
By the way talking about hot dog sales man has any one heared about the status of the legal case or any news about brett and where he is or who else he is scamming now ?????????
By the way talking about hot dog sales man has any one heared about the status of the legal case or any news about brett and where he is or who else he is scamming now ?????????
1
111222
Guest
They suffered the same problem many, if not most radio companies have had...they paid way too high to get in, and they never had a chance. This is a catch 22 for most of the industry...they took on unrealistic debt during a decent economy, and now they have no way to pay the piper. Companies have tried to deal with this by CUTTING, but those cuts eventually hurt the product they were selling. It will be interesting to see how radio survives this.
Radio station economics in South Jersey work much the same as the tourist related businesses. You make your money in the summer and CYA in the winter. Even the big boys like Equity and Millenium work on this model. Sales are great from May through the fall. You save up a war chest big enough to cover your expenses over the 1st quarter. It's been like that for years.
The thing that still puzzles me is that Atlantic lost SO MUCH money over what is traditionally the busiest season of the year. These weren't start ups..they were active stations with some nice local and national accounts, casinos, beer money, etc. How could they lose SO MUCH money over the summer and fall, so that they would have to throw in the towel by November? And after cutting thousands in expenses by gutting their programming department. They were experienced radio managers who own successful properties themselves. They were smart and capable. And they had the summer economy to fatten the bank accounts. What happened?
No one will ever know, of course except the individuals involved. However, one scenario seems at least plausible. Suppose you come in to manage a cluster. You see that sales are soft and the operation is losing money. You try to rally sales and swap formats. But the existing debt service is crushing you. The economy has cut the value of the properties by a third or more. What to do? How do you deal with the debt service? How can you turn this losing situation around for personal gain?
What you do is let the company fail. Tear it down. Run it into the ground. File for protection and leave the lien holders and creditors out to dry. You have no personal stake, so who cares? When the assets come up for sale to satisfy the creditors, quietly move through a shell company to buy them yourself at their drastically reduced price. Now, you OWN the stations, and at 50 cents on the dollar. The debt service is manageable and you have made a purchase at a 20 year low bargain basement price. You win. The bank and the creditors and the original investors lose.
I would call that fraud. But I guess that's how you get to be a millionaire flying in on private jets these days.
The thing that still puzzles me is that Atlantic lost SO MUCH money over what is traditionally the busiest season of the year. These weren't start ups..they were active stations with some nice local and national accounts, casinos, beer money, etc. How could they lose SO MUCH money over the summer and fall, so that they would have to throw in the towel by November? And after cutting thousands in expenses by gutting their programming department. They were experienced radio managers who own successful properties themselves. They were smart and capable. And they had the summer economy to fatten the bank accounts. What happened?
No one will ever know, of course except the individuals involved. However, one scenario seems at least plausible. Suppose you come in to manage a cluster. You see that sales are soft and the operation is losing money. You try to rally sales and swap formats. But the existing debt service is crushing you. The economy has cut the value of the properties by a third or more. What to do? How do you deal with the debt service? How can you turn this losing situation around for personal gain?
What you do is let the company fail. Tear it down. Run it into the ground. File for protection and leave the lien holders and creditors out to dry. You have no personal stake, so who cares? When the assets come up for sale to satisfy the creditors, quietly move through a shell company to buy them yourself at their drastically reduced price. Now, you OWN the stations, and at 50 cents on the dollar. The debt service is manageable and you have made a purchase at a 20 year low bargain basement price. You win. The bank and the creditors and the original investors lose.
I would call that fraud. But I guess that's how you get to be a millionaire flying in on private jets these days.
Well, if you're a partner in the business, you can do what you like as long as it's not illegal. Qualifications are summarized as the amount of cash you've provided - regardless of what's on your resume.
That having been said, I wouldn't discount someone who made money in food sales from being able to run a radio station - or a cluster - but not everyone has the right "gut" for it. Especially when they're over-leveraged and need to keep cashflow up; the realities of the business don't leave a lot of room for learning on the job, and that's like having to hit a home run for the Yankees, and never having swung a bat before the "big shot".
Funny thing about money - it'll let you buy enough rope to hang yourself.
That having been said, I wouldn't discount someone who made money in food sales from being able to run a radio station - or a cluster - but not everyone has the right "gut" for it. Especially when they're over-leveraged and need to keep cashflow up; the realities of the business don't leave a lot of room for learning on the job, and that's like having to hit a home run for the Yankees, and never having swung a bat before the "big shot".
Funny thing about money - it'll let you buy enough rope to hang yourself.
HUB CITY some of your points are very true but in this specific case you are off base.
number one- if you are a majority stock holder yes you can do what every you want but in this case brett was not a majority stock holder and didnt put one penny of his own monies in this radio deal. What he did was scam some stupid investors that he has the expertise in the radio buisness which in reality the only thing he did was being a part time dj .
number two Brett did not have much sucess in the hot dog business in fact if you look at his history in business practices he did the same scam job he did in the hot dog business steal money for his personal use and not pay his bills to purveyors . as what he did in the radio business.
like brett or hate Brett he has a long long history as a scam artist
he is not the nice guy you really think he is and should be punished for his actions.
number one- if you are a majority stock holder yes you can do what every you want but in this case brett was not a majority stock holder and didnt put one penny of his own monies in this radio deal. What he did was scam some stupid investors that he has the expertise in the radio buisness which in reality the only thing he did was being a part time dj .
number two Brett did not have much sucess in the hot dog business in fact if you look at his history in business practices he did the same scam job he did in the hot dog business steal money for his personal use and not pay his bills to purveyors . as what he did in the radio business.
like brett or hate Brett he has a long long history as a scam artist
he is not the nice guy you really think he is and should be punished for his actions.
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