Buffalo News article on Citadel/Cumulus

[Element9]

The first part of Dickey's presentation can be read here http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9NDE3NzM3fENoaWxkSUQ9NDMwNDY5fFR5cGU9MQ==&t=1 (may take a while to load) There weren't as many questions as expected and the relatively soft nature of questions from analysts was surprising. Bishop Sheen actually gave Lew an "attaboy." These guys are so in bed with each other. The discussion of proprietary platforms was somewhat revealing, especially as they'll apply to billing/accounting, traffic and music scheduling/automation software. Cumulus calculates the Citadel purchase at 7.6 x EBIDTA and predicts Cumulus will be within terms of their loan covenants by Q2. With 570 stations in 120 markets, offering a veritable tsunami of synergies across multiple platforms, Lew says he expects the deal to close "some time in Q3," not Q4 as previously predicted by a number of publications.

 

[TheBigA]

With 570 stations in 120 markets, offering a veritable tsunami of synergies across multiple platforms, Lew says he expects the deal to close "some time in Q3," not Q4 as previously predicted by a number of publications.

I've heard the "synergies" thing before. That's often a lot harder to accomplish than one would think. Back when AOL merged with Time Warner, everyone at both companies talked about synergies. They never materialized. Same with Clear Channel buying up all the concert venues. The biggest problem they have is the former ABC Radio Network, which still hasn't recovered from the death of Paul Harvey. Having lots of platforms doesn't matter if they don't have content, and that's where they're weak right now.

 

[SirRoxalot]

$50-million in synergies? Should be easy to accomplish. Isn't that what Farid, Judy, & Co. were going to get in stock for "guiding the company through bankruptcy"? Firing them without their "bonus" ought to save $50-million immediately. Heck, throw in a few VPs, and you could save that much just at the corporate level without even getting to the stations.

 

[TheBigA]

Firing them without their "bonus" ought to save $50-million immediately.

I haven't seen the specifics, but my bet is they will get a bonus plus the increased value of their gift stock when the sale goes through that will be more than $50 million. The plus side is you won't have Farid to kick around any more.

 

[SirRoxalot]

I don't believe that they got the "gift stock". That was the incident that started R2's whole noise-making that lead to the sale.

I doubt that anybody will miss Farid. I also don't expect anybody's excited about the impending Dickey regime.