Clear Channel and Cumulus are in the same boat.....so I ask this question again.....If you had a dollar, would you rather buy 20 shares of Citadel stock or 3 Milky Ways? Also, the $.05 price for Citadel stock makes Sirius look good at $.65 per share when Sirius would already be bankrupt if their debt had not been paid for them.
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CITADEL STOCK CLOSED AT $.05 PER SHARE
- Thread starter RADIO TRUTH
- Start date
I wouldn't buy any of the above..I would just sit back and watch the fun unfold in bankruptcy court.
If both do file for chapter 11, I am going to laugh so hard that people will hate me.
If both do file for chapter 11, I am going to laugh so hard that people will hate me.
Why?
Bankruptcy is very common today. It doesn't mean dissolving or going dark. It means holding off creditors (and banks seeking $150-million that Citadel can't fork over on the covenant due date of Jan. 15th.
It doesn't mean they'll be "out of business" or off the air. It means they buy time to reorganize, the banks gain control of the assets and Citadel emerges with a new "game plan" until the banks say "sell the assets to the highest buyer" or Citadel sees the stock go back up (which is unlikely at this time.)
The assets of the radio stations are worth a ton more than the lack of investor stock used to keep the company going but had nothing to do with the operating expense of the company and its stations. The stations have taken a hit because of the economy (14% overall, 9 percent without the ABC Radio Networks -- better than most other groups.)
The corporate stock is worthless, but the debt must still be paid. There is no money in the cookie jar. But the stations, as a whole, still function, they still pay their local bills, they have gone through cuts and will go through more during bankruptcy.
The pre-packaged bankruptcy allows the banks to keep their fingers in the pie by giving them debt-for-equity -- and a way to recoup their investment. Citadel could do a bankruptcy on its own, but that would kill the investment banks who would then have no control. They don't want that. So, the potential between the two parties is a dance not unlike what Clear Channel is going through.
Will there be sales? I'd think so, but only to those with deep pockets and not merely wanting to buy small clusters. It would be a significant sale if it happens. And the same people running Citadel (into the ground,) would probably remain because banks don't run radio stations nor want to own them. Look for few changes. Possibly, the board of directors could toss Suleman and Ellis over the side, but that appears unlikely.
Listeners won't notice anything. It's won't be "Doug Limmerick, ABC News -- debtor in possession." Or WLS going dark. It's protection against creditors - not shutting down the company. So, there's some heavy squeezing about to go on for the next two months.
Pre-packaged bankruptcy or a sale to a major, cash heavy group looking to buy certain markets the best proposition for now, unless the banks rewrite the covenants and let Farid off the hook -- again. Investor shares for a nickel each don't matter at this point. Investors have already had their bells rung in losses and have been screwed. That's why the price is at a nickel again. Investors have no say. Their money already went into the asset purchase which killed the company. Now, the banks want to ensure they down have more losses and must stop the bleeding.
And fast.
Bankruptcy is very common today. It doesn't mean dissolving or going dark. It means holding off creditors (and banks seeking $150-million that Citadel can't fork over on the covenant due date of Jan. 15th.
It doesn't mean they'll be "out of business" or off the air. It means they buy time to reorganize, the banks gain control of the assets and Citadel emerges with a new "game plan" until the banks say "sell the assets to the highest buyer" or Citadel sees the stock go back up (which is unlikely at this time.)
The assets of the radio stations are worth a ton more than the lack of investor stock used to keep the company going but had nothing to do with the operating expense of the company and its stations. The stations have taken a hit because of the economy (14% overall, 9 percent without the ABC Radio Networks -- better than most other groups.)
The corporate stock is worthless, but the debt must still be paid. There is no money in the cookie jar. But the stations, as a whole, still function, they still pay their local bills, they have gone through cuts and will go through more during bankruptcy.
The pre-packaged bankruptcy allows the banks to keep their fingers in the pie by giving them debt-for-equity -- and a way to recoup their investment. Citadel could do a bankruptcy on its own, but that would kill the investment banks who would then have no control. They don't want that. So, the potential between the two parties is a dance not unlike what Clear Channel is going through.
Will there be sales? I'd think so, but only to those with deep pockets and not merely wanting to buy small clusters. It would be a significant sale if it happens. And the same people running Citadel (into the ground,) would probably remain because banks don't run radio stations nor want to own them. Look for few changes. Possibly, the board of directors could toss Suleman and Ellis over the side, but that appears unlikely.
Listeners won't notice anything. It's won't be "Doug Limmerick, ABC News -- debtor in possession." Or WLS going dark. It's protection against creditors - not shutting down the company. So, there's some heavy squeezing about to go on for the next two months.
Pre-packaged bankruptcy or a sale to a major, cash heavy group looking to buy certain markets the best proposition for now, unless the banks rewrite the covenants and let Farid off the hook -- again. Investor shares for a nickel each don't matter at this point. Investors have already had their bells rung in losses and have been screwed. That's why the price is at a nickel again. Investors have no say. Their money already went into the asset purchase which killed the company. Now, the banks want to ensure they down have more losses and must stop the bleeding.
And fast.
When Mega Media went bankrupt in August, they hoped to reorganize their debt and have a plan by December. However, Island Broadcasting forced them to pay their lease payments by the end of October, or else lose 87.7. Their case is now a chapter 7 and the stock price is a twentieth of a cent.
BJ Steigner said:
I think that's the wrong attitude to take. It ignores the fact that a lot of innocent people will be affected, and that the entire industry will be painted with a negative brush, even though only a couple companies are to blame. Good broadcasters who'd like to re-enter the business (perhaps to buy former CC or Citadel stations) will find it even harder to get loans, because broadcasting will be a bad risk.
Plus, if your goal is some form of "justice," no one will be fined, and the judge won't demand anyone return any money. So you still have multi-millionaire owners who get to keep their money, while a lot of employees, who had their retirement money matched with company stock in their 401K plans, will get the shaft. So you're laughing at the wrong people. Mays & Suleman retire to their private islands, while their former employees struggle. There will be no "justice."
Nick said:
I'm sorry, but I disagree.
Mega Media was looking for creditor protection in an effort to raise investment funds that they were already behind on. Citadel and its stations have cash flow on many station that eclipses that of what Pulse 87 had by a mile. Plus, the investment banks are way more invested in the Citadel / ABC stations than they ever were (if at all) in Mega, which was losing money long before the switch from Russian to Dance.
We're talking a national radio network andthe most legacy heritage stations in the country, many which are stlll paying the bills with Citadel / ABC.
A pre-packaged bankruptcy is likely. The ivnestors hae already lost their money. Now, it's up to the investment banks to save their investment -- a lot different than with Mega Media. There 's a lot more at stake.
Mega leased Pulse and didn't own it. Citadelis wholly owned with many assets, including some of the biggest stations in the country.
They won't pay the $150-million owed in January, but their proceeding ith a pre-packaged Chapter 11 bankruptcy keeps them operating and keeps the creditors at bay -- something that Mega couldn't do because it was out of money. Big difference behind "debt" and "equity." As a leased operation, Mega (Pulse) had no equity. Citadel / ABC does.
RADIO TRUTH said:
Candy has gone way up in price. Even at Walmart the cheapest I've seen a Milky Way bar is 58 cents for the small and $1.08 for the king size. Other stores such as ShopRite, Price Chopper, and Stop & Shop have the small Milky way varying in price between 69 cents and 84 cents.
So you're laughing at the wrong people.
Laughing you say?? I am laughing at the radio business because it's dead. If someone had better management and a better playlist, they would come out on top.
There are rules set for radio and it really sucks....Demos and Sales.
What about honest promotion without milking the smaller labels? How about giving time to the unsigned???
Think about it.
Laughing you say?? I am laughing at the radio business because it's dead. If someone had better management and a better playlist, they would come out on top.
There are rules set for radio and it really sucks....Demos and Sales.
What about honest promotion without milking the smaller labels? How about giving time to the unsigned???
Think about it.
BJ Steigner said:
Define "better."
Does XM have a better playlist? Are they on top?
Does WBGO have a better playlist? Or maybe WFUV? Or WFMU? Are they on top? No. Better playlists don't put radio stations on top. The best does not always win. We see it every day.
Radio is not one company. There are hundreds of companies that own radio stations. Some have better management than others. But the entire industry gets painted by the same brush when bankruptcy occurs, because loans will become more difficult to get. So even good managers will be seen as failures because a few peed in the pool.
But sure, it would be great if money wasn't involved, and radio didn't have to get advertising to stay on the air. It would be great if artists didn't need labels or money to get airplay. It would be great if we all made the same amount of money, regardless of what we did or what our abilities were...a level playing field. But that's not the world we live in.
In the meantime, you ignored my point: That innocent people are being hurt while you laugh. It's not funny. Nothing is funny about failure. And I have no reason to believe that their playlists could have changed the outcome, and I have no reason to believe that management will pay for what they did. So stop laughing.
BJ Steigner said:
Yes, correct. A commercial radio station, going back to the 30's, has to reach an audience advertisers want, and then they have to sell the avertiser on the idea. If that does not happen, there is no revenue and no radio station.
Promotion is done by the labels, not radio stations. And no label pays for regular daytime airplay at any station in the US that I know of. A large percentage of stations play no new music at all, and that is the appeal of their format. Some others add maybe 2 or 3 songs a month... and that is because the format does not work best with more. Very few stations add more than a half-dozen songs a month.
Quite a few times I have tried some kind of local undiscovered artist show. Each time, the time period has been the worst rated on the station. So few people care, and the rest of the folks don't hear the songs they came to hear.
MarcB said:
He was talking in bite sized pieces.
It's weird thinking that a $1 bottle of soda could buy 2000 shares of MMDAQ. But the bottle of soda would actually be worth something.Sam Lit said:
I think CHR stations add more than 6 songs a month. Considering I get enough CHR and urban stations to fill my presets twice, that isn't "very few"
Nick said:
There are 14,000 radio stations in the US, and a couple of hundred CHR's. That is, releatively, few.
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