Beasley Buys JBR-FM

[fred flintstone]

All Access:

Beasley Buys WJBR/Wilmington
NEXTMEDIA is selling AC WJBR/WILMINGTON, DE to BEASLEY for $42 million. BEASLEY started operating WJBR under an LMA on SUNDAY (10/1); it owns a cluster in nearby PHILADELPHIA that includes Country WXTU, Top 40-Rhythm WRDW (WIRED 96.5), Religion WTMR-A, and Business News WWDB-A.

WJBR is currently number one in Wilmington and consistently shares the top two spots with Delmarva's WSTW. WJBR is an also-ran in the Philly market.

WXTU is the number 11 station in Wilmington, and the number two country station (behind Delmarva's WXCY).
Wired is number 14 in Wilmington and the number two CHR station (behind WSTW).

Could the Beasley's be making a move to build a Wilmington cluster and become a player in the Wilmington market? If so, could Clear Channel's Delaware properties (any or all) be next on their shopping list? If they do pick up any or all of CC's AM stations, look for brokered programming, like WTMR and WWDB. Look for them to remake DSD in XTU's image - possibly even simulcast. And then, there's the River....

 

[radiophiler]

Speculation in the trade media seems to go in the opposite direction.

Check out JBR's signal on radio-locator.com. It's already a real player in Philly as far as its signal goes.

Inside Radio openly speculates that JBR could be made into a Philly station. If done properly, JBR can keep its #1 or #2 spot in Wilmington, and be a player in Philly.

Might Beasley want to keep the AC format and chip away at B-101's share? If so, watch for B-101 to insist that JBR drop Delilah or B would go back to having a local evening show.

 

[fred flintstone]

Inside Radio is published by Clear Channel and publishes a column by Brian Maloney.
IMHO: It has zero credibility, and a conflict of interest inherent in covering an industry in which its owner it the biggest player.

If the Beasleys attempt to change the transmitter location or the city of license in an attempt to "move in" to the Philly market, expect a major political backlash from Delaware's congressional delegation. Even though Wilmington mostly listens to Philly radio, there is a strong sentiment that Delaware should have local media (even among people who don't listen to it much).

The loss of Sunny may provide an opportunity to pick up that station's former listeners (many of whom don't especially like B101 as an alternative). However, any attempt to pick up Philly listeners would require a major promotional effort and that co$t$ big buck$. (The Beasley's don't especially like spending money.) And the more time that passes following Sunny's flip, the more its audience will become settled into new listening habits. Those who don't move to B101 will likely settle on OGL or even the Allentown AC station at 100.7 (which, like JBR, also puts a decent rimshot signal into much of the Philly market).

What works in favor of Inside Radio's "theory" is the Beasley's have been known to make some dumb moves.

 

[Jul]

Press Release about WJBR-FM

October 03, 2006 10:37 AM Eastern Time
Beasley Broadcast Group to Acquire WJBR-FM in
Wilmington, Delaware for $42 Million

- 50,000 Watt Adult Contemporary Station Reaches Four States -

NAPLES, Fla. & WILMINGTON, Del.--(BUSINESS WIRE)--Beasley Broadcast Group, Inc. (Nasdaq: BBGI), a large- and mid-size market radio broadcaster, announced today that it has entered into a definitive asset purchase agreement with NextMedia Group, Inc. to acquire WJBR-FM 99.5 Mhz in Wilmington, Delaware for approximately $42 million. Wilmington is the nation’s 75th largest radio market when ranked by revenue.

The transaction, expected to close in the first quarter of 2007, is subject to FCC approval and other customary conditions to closing. Beasley Broadcast Group began operating the station under a local marketing agreement as of October 1, 2006. Beasley Broadcast Group intends to fund the purchase price with borrowings under its existing credit facility. Star Media Group and Bergner & Co. served as the brokers for the transaction.

George G. Beasley, Chairman and Chief Executive Officer of Beasley Broadcast Group, Inc., commented, “We expect that the acquisition of WJBR-FM will prove to be an attractive strategic and financial transaction. With a 50,000 watt signal, the station reaches listeners in Delaware, Pennsylvania, Maryland and New Jersey and represents a solid addition to our radio station portfolio and good complement to our existing Philadelphia station cluster. WJBR has a well-established adult contemporary format featuring ‘Today's Hits and Yesterday's Favorites,’ serves the 25 - 54 year-old demographic and has developed strong listenership in office settings. In addition, WJBR-FM's News Center brings listeners local news, sports and weather coverage and the area's only daily local airborne traffic report.”

Founded in 1961, Beasley Broadcast Group, Inc. is a radio broadcasting company that owns or operates 42 stations (26 FM and 16 AM) located in ten large- and mid-size markets in the United States.

Note Regarding Forward-Looking Statements:

Statements in this release that are “forward-looking statements” are based upon current expectations and assumptions, and involve certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words or expressions such as “intends”, “expects,” “expected,” “anticipates” or variations of such words and similar expressions are intended to identify such forward-looking statements. Key risks are described in the Company’s reports filed with the Securities and Exchange Commission (SEC). Readers should note that these statements are subject to change and to inherent risks and uncertainties and may be impacted by several factors, including: economic and regulatory changes, the loss of key personnel, a downturn in the performance of our large-market radio stations, the Company’s substantial debt levels, and changes in the radio broadcast industry generally. The Company’s or WJBR’s actual performance and results could differ materially because of these factors and other factors discussed in the “Management’s Discussion and Analysis of Results of Operations and Financial Condition” of our SEC filings, including but not limited to annual reports on Form 10-K or quarterly reports on Form 10-Q, copies of which can be obtained from the SEC, www.sec.gov, or our website, www.bbgi.com. All information in this release is as of October 03, 2006, and the Company undertakes no obligation to update the information contained herein to actual results or changes to the Company’s expectations.

 

[OldNumber7]

If the Beasleys attempt to change the transmitter location or the city of license in an attempt to "move in" to the Philly market, expect a major political backlash from Delaware's congressional delegation. Even though Wilmington mostly listens to Philly radio, there is a strong sentiment that Delaware should have local media (even among people who don't listen to it much).

The loss of Sunny may provide an opportunity to pick up that station's former listeners (many of whom don't especially like B101 as an alternative). However, any attempt to pick up Philly listeners would require a major promotional effort and that co$t$ big buck$.

I'd be astonished if the hidden intent involves moving the stick. We don't see it in the overall Philly numbers, but JBR has a kickass signal and a lot of listeners in Delaware County and Chester County (i.e. where the big consumer money is) and the potential to draw many more with only some promotional fine tuning. I think it makes perfect sense for a Philly cluster to add a rimshotter to the combo that reaches well into the suburban money zips. I figure the stick will stay put and JBR will reimage itself as a regional station reaching all those people who drive from their homes in one exurb to jobs in another and never see the Philly skyline.

 

[radiophiler]

I agree with Old Number 7's scenario completely.

As for losing Delaware stations to Philly: Look at channel 12. Its commitment to Delaware consists of a half hour daily newscast and some documentaries. Otherwise, it completely markets itself as Philly's PBS station. Delaware has many other radio stations. It has no other TV station. If the Congressional delegation wants to make a fuss about losing a broadcast signal, maybe they should just give JBR the same deal Channel 12 has: Maintain a satellite studio somewhere in NCCo, devote some public affairs time to Delaware. And the air time doesn't need to be prime time: 5:30-6pm is hardly prime time in TV.

 

[fred flintstone]

The channel 12 situation is very different:
That was then; this is now.
That's TV; this is radio.

While Beasley does have their Philly, Miami and Las Vegas clusters, they are more an operator of medium market clusters: Places like Augusta, Greenville, Fayetteville and Fort Meyers. Clear Channel hasn't managed to do it but operators like Saga, Cumulus, Regent and Beasley know medium markets - like Wilmington - can pay off well with good management.

And if it's so easy move in to the Philly market, how come Delmarva hasn't tried it? And how come Nassau hasn't had that much impact with their two move-in stations from Trenton (one of which has a similar format to STW)?

Beasley bought a station with a winning forumula. It wouldn't be the first time a combination of ego and hubris has screwed up a good thing. They've got Wilmington. They could make a play for Philly and end up with neither one. It has happened before.

 

[fred flintstone]

WJBR goes for $42 million
WILM goes for $4 million.
WILM mostly has a 2 something share.
That would mean if sale price has anything to do with ratings, WJBR should have something like a 25% share.
But they don't. Usually they are somewhere around 10 plus or minus.
Rule of thumb is station price is 10 to 14 times annual revenue.
That would mean WILM had $400-thousand to $560-thousand (in somebody's dreams).
WJBR's sales revenue would be $4.2 million to $5.9 million (well, maybe).

Based on these numbers, here are some other estimated selling prices.
WSTW - $50 million
WDEL - $10 million.
WXCY - $12 million.
WDRX - $8 million.
WDSD - $6 million.
WJKS - $4 million
The Ticket - $.5 million
WAMS - $400 thousand