Cumulus files for bankruptcy again

[thenetwork]

I know he's long gone, but as we used to say, back in the day, in Toledo...

"Dickey Lew, before Lew can dickey you"

I was told back then, when looking for a radio job in Toledo, to make Lew Dickey's radio stations (WOHO and WWWM at the time) a last resort option.

I somewhere have an old radio on-air promotion from then-daytimer WTOD in the 60's that flat-out made fun of Lew's stations (the name of the station's street locations were slightly changed from Pickle Road to another vegetable name). They said that this "mythical Toledo station' did not allow their DJ's to have guests visit nor to have ANY fun during their shifts, unlike WTOD.

Sad that that mentality has lasted and expanded all these decades later...

 

[TheBigA]

Here's an interview with an analyst who says the investment community anticipated the Cumulus bankruptcy:

Cumulus Restructuring Seen As Predictable.

Cumulus Media has begun what could be a months-long restructuring after filing Chapter 11, a move analysts say investors largely expected as debt levels climbed. Kagan analyst Justin Nielson says

www.insideradio.com

He goes on to say the problems facing Cumulus were not unique. Other companies are in the same situation.

 

[umfan]

Bankruptcy Filing Puts Cumulus Antitrust Lawsuit Against Nielsen On Hold.

The antitrust lawsuit between Cumulus Media and Nielsen has been paused after Cumulus filed for Chapter 11 bankruptcy. A federal judge ordered an automatic stay of the case under bankruptcy

www.insideradio.com

Here's and interesting side effect of the Cumulus' bankruptcy.....it puts a hold on the litigation between then and Nielsen.

Since it doesn't resolve the disputes, I expect that Cumulus will continue to be absent from Nielsen ratings.

 

[K.M. Richards]

Since it doesn't resolve the disputes, I expect that Cumulus will continue to be absent from Nielsen ratings.

Now that is one of the most reasonable and intelligently thought-out statements I have read here in some time.

 

[MarkW]

A Cumulus / Beasley marriage of some kind would not surprise me in the least. Certain aspects of the terms of the Transaction Support Agreement entered days ago by Beasley's noteholders suggest to me the company, or major assets within the company, are being marketed for sale or soon will be marketed for sale.

A clean Cumulus balance sheet would make it much easier to issue new debt to support an acquisition of, or merger with, Beasley.

 

[TheBigA]

A clean Cumulus balance sheet would make it much easier to issue new debt to support an acquisition of, or merger with, Beasley.

If you were a lender who just lost a half billion on Cumulus, would you be looking to dig another hole in the same business?

I can't understand why anyone would invest any money in broadcasting.

 

[MarkW]

If you were a lender who just lost a half billion on Cumulus, would you be looking to dig another hole in the same business?

I can't understand why anyone would invest any money in broadcasting.

I personally agree with your sentiments.

That said, there are still well heeled investors willing to invest in broadcasting companies. Look no further than Soros.

I suspect anyone who already lost significant money on Cumulus is very unlikely to invest new dollars in support of a Cumulus / Beasley roll-up.

 

[TheBigA]

That said, there are still well heeled investors willing to invest in broadcasting companies. Look no further than Soros.

His situation is different. I consider what he did was "park" money there in order to take the company private.

If they added any new debt, he'd likely pull out, because it would put his money at risk.

Back to Beasley, I agree they're in play. The family is looking for an offramp. Two second generation broadcasters, Field and now Beasley, getting out.

 

[davideduardo]

I can't understand why anyone would invest any money in broadcasting.

Please explain, in that context, the Soros funded or Soros organized purchases of two broadcast groups.

The second and more recent purchase of debt seems to be "liquidation value" is greater than the loan (where "liquidation" may be based on sale or asset depreciation, such as with oil fields near end of life that will produce more income than the purchase cost).

But the straight purchase of the Univision dogs, with zero hopes of value recovery or profitability, makes not sense.

 

[davideduardo]

I personally agree with your sentiments.

That said, there are still well heeled investors willing to invest in broadcasting companies. Look no further than Soros.

Soros bought debt, not stations, with the most recent deal. He is counting on the cash flow retiring the debt at a profit. The equity value is coincidental and may be, in the long run, zero. He bought the debt, converted it to equity. That took the company private, so he gets whatever profit he can take after paying the highly reduced remaining debt..

I suspect anyone who already lost significant money on Cumulus is very unlikely to invest new dollars in support of a Cumulus / Beasley roll-up.

These purchases , as I have mentioned, are much like the purchase of near depletion oil wells or fields which may be considered to be bought for the high annual income even though the final residual value will be zero. Radio today is about as good a future play as a near depletion well.

 

[TheBigA]

Please explain, in that context, the Soros funded or Soros organized purchases of two broadcast groups.

See my answer in post #68

Personally I used to own stock in several broadcast companies. One by one, I've sold my shares and moved the money to high technology stocks.

But the straight purchase of the Univision dogs, with zero hopes of value recovery or profitability, makes not sense.

In that context I agree. I still stand by what I said at the time, which is they saw a proposal from a couple of Hispanic women, and wanted to fund their idea. Financially it was a drop in the bucket, and he wrote it off as a mitzvah. By that I mean he saw it as charity.

 

[davideduardo]

See my answer in post #68

Soros' intent was to make the group private. Then he could pay the remaining debt out of profits and earn back the capital from the excess over debt payment.

In that context I agree. I still stand by what I said at the time, which is they saw a proposal from a couple of Hispanic women, and wanted to fund their idea. Financially it was a drop in the bucket, and he wrote it off as a mitzvah. By that I mean he saw it as charity.

The two women did not come up with the idea. The concept came from somewhere else in the Soros or Democrat Party. They found two figureheads, totally devoid of any radio or media experience, that made the concept have a good picture.

At the beginning, the women thought they could rapidly transform those stations into something new. They found they could not hire people talented enough to make a good attempt at it, and their own ideas were terrible. At present, the whole group is in a holding pattern and they have cut back on most of their original programming.

 

[TheBigA]

Soros' intent was to make the group private. Then he could pay the remaining debt out of profits and earn back the capital from the excess over debt payment.

Yes I agree. That's what I meant by "parking" the money.

The two women did not come up with the idea. The concept came from somewhere else in the Soros or Democrat Party. They found two figureheads, totally devoid of any radio or media experience, that made the concept have a good picture.

The only evidence you have of that is what biased people have told you. People on the right created this conspiracy theory that the women were going to run radio stations to brainwash Hispanics into voting for dems. They used that to get the FCC to deny the license transfer. None of that ever happened. It was all chicken little thinking. It obviously didn't work because you know who won the election, with help from Hispanics. Totally made up conspiracy theory. The idea that zero audience AM radio stations would affect an election is completely laughable. Hispanics aren't that gullible.

Diaz-Balart Joins Rubio, Colleagues Sounding the Alarm on Sale of Spanish-Language Radio Stations to Newly Formed Leftwing Media Group

Congressman Mario Diaz-Balart (FL-25) joined Senator Marco Rubio (R-FL) and colleagues in a letter to Federal Communications Commission (FCC) Chairwoman Jessica Rosenworcel regarding the sale of 18 Spanish-language radio stations, including Miami’s conservative Radio Mambí, to the Latino Media...

mariodiazbalart.house.gov

 

[davideduardo]

The only evidence you have of that is what biased people have told you.

I was still with Univsion when this deal went down, and know a good deal about the people involved. The seller had no political interest. They just found that the Soros group had more money than Salem, whatever their intents were.

I know a dozen or more people who were interviewed for management positions; all but two realized that the two women had no radio vision. The two that took positions are very sorry they did.

People on the right created this conspiracy theory that the women were going to run radio stations to brainwash Hispanics into voting for dems.

The first thing they did to "neutralize" WAQI was proof that that was, indeed, their intent. They thought that Miami needed a more balanced talk format and were wrong, but that was their intent from the very beginning.

They used that to get the FCC to deny the license transfer. None of that ever happened.

Yes, it did. They immediately ordered WAQI to be more "balanced" in their perspective.

It was all chicken little thinking. It obviously didn't work because you know who won the election, with help from Hispanics.

What happened is that nobody with real radio experience and success wanted to work for them. The moves they made on their own were poorly thought out, and convinced any valid and viable candidates for executive positions that there was no upside.

Totally made up conspiracy theory.

That is exactly what happened. Somewhere on the left, there arose a fear of Salem getting "all those stations" in important Hispanic markets. Those who pushed the project did not, obviously, know that programming could not be changed overnight. One person involved told me that they were told that "the programming could be quickly flipped, just like ABC and CBS and NBC start a 'new season" each time Fall rolls around."

The whole effort was to keep those stations away from Salem. The concept did not work for a variety of reasons.

The idea that zero audience AM radio stations would affect an election is completely laughable.

WAQI was hardly a zero-audience station until they castrated it. Several stations, such as the Fresno and Las Vegas FMs had significant audience, and the LRGV cluster is very significant as was WAQI and the Chicago AM station.

 

[TheBigA]

Yes, it did. They immediately ordered WAQI to be more "balanced" in their perspective.

What's wrong with "a more balanced perspective?" Isn't that what you'd like to see at CBS and CNN??? Should people challenge those sales using the same mythology Rubio used in 2022?

WAQI was hardly a zero-audience station until they castrated it. Several stations, such as the Fresno and Las Vegas FMs had significant audience, and the LRGV cluster is very significant as was WAQI and the Chicago AM station.

The audience was all over 70 at Mambi. One station out of 18. Two hosts quit, the audience stopped listening, and any possible democrat influence went away. So much for election interference. In the meantime, Cumulus has talk show hosts presenting anything but "a more balanced perspective" every day. Nobody sees that as a problem, right?

 

[Schroedingers Cat]

I rue the day that big group owners started to take over stations in smaller markets that they really didn't understand or care about, and were willing to shut them down without seriously trying to sell them to people who cared about radio and local markets. This has been complicated by other companies buying their land and towers, and more than willing to sell the land out from under the radio licenses. This has all caused a haphazard accelerated destruction of the AM band in particular. AM stations with poor signals and translators are being kept on because they are nondirectional, and hardly anyone knows how to maintain DAs cheaply anymore. These are the stations with good signals, low NIFs, >=5000 watts, but directional because they are the old Class III-As and Class III-Bs. Alarmingly, MANY Class As are now being degraded signal wise, that were the last to be allowed to apply for translators. The good translator opportunities and frequencies were gone.

Instead of allowing larger cities to have more FM frequencies, like Canada and Mexico allowed, the FCC came up with Docket 80-90 stations with "First Local Service", but are prevented from moving from the middle of nowhere to upgrade. Long ago, the FCC should have again allowed contour based allotments on Channels 221-300 like they did before 1964, and the Channels 200-220 NCE-FM band continues to allow, as opposed to distance separation requirements. Those ended up as second class stations that are less valuable, and unable to upgrade, and are known euphemistically as "rimshots". In the guise of providing service to underserved areas, the FCC and NAB protected big market stations from competition, and a less valuable FM band.

This is leading to the haphazard destruction of not just AM radio, but radio in general. It's being excused by people who claim that less reliable internet and satellite "radio" services, that are also not free, will take over all listening.

 

[davideduardo]

What's wrong with "a more balanced perspective?" Isn't that what you'd like to see at CBS and CNN??? Should people challenge those sales using the same mythology Rubio used in 2022?

In Miami, where the folks in the age range where talk radio is of interest, nearly everyone is Cuban. You could interview a thousand Cubans or Cuban Americans over 50 in Miami without finding one who believes that the Castro regime in Cuba was good or beneficial.

So... those people want to hear a voice on the radio that reflects their own opinions on the Cuban government. A "balanced" perspective in Miami will get your station burnt down.

The audience was all over 70 at Mambi.

No, it's average age was in the later 60's. Miami has the oldest Hispanic community in the U.S.

One station out of 18. Two hosts quit, the audience stopped listening,

... because the strongly anti-communist perspective was moderated. You don't do that for an audience where everyone has been jailed, had a relative jailed, had someone they know or a family member killed, had their rations cut or suspended, been demoted at work and other negative things during their family's life back in Cuba.

and any possible democrat influence went away. So much for election interference. In the meantime, Cumulus has talk show hosts presenting anything but "a more balanced perspective" every day. Nobody sees that as a problem, right?

In this case, the issue is that the purchase of the Univision stuff was motivated by a desire to keep it away from Salem. The Cumulus affair, tens of times more money behind it, is strictly a debt / equity play.

 

[TheBigA]

I rue the day that big group owners started to take over stations in smaller markets that they really didn't understand or care about, and were willing to shut them down without seriously trying to sell them to people who cared about radio and local markets.

Isn't Connoisseur doing exactly what you want owners to do? In Missouri, South Dakota, and other states??

They're selling stations to local owners who already know the properties, and even helping with the financing.

I think Cumulus has really tried to sell their AMs, but there don't seem to be any buyers. They'd love to get rid of 560 in San Francisco.

 

[TheBigA]

A "balanced" perspective in Miami will get your station burnt down.

You're sort of perpetuating a criminal narrative about Hispanics that you don't really believe. All they really did in this case was stop listening.

Which is exactly what people are doing to CBS. Broadcasters can't force people to believe something they don't agree with. It's the American way.

It doesn't matter who owns the station. Conservative talk radio is preaching to the converted on stations that don't exist to people under 60.

Salem had no money to spend for more money losing AM stations. LMN did them and Univision a massive favor.

 

[umfan]

I was still with Univsion when this deal went down, and know a good deal about the people involved. The seller had no political interest. They just found that the Soros group had more money than Salem, whatever their intents were.

I know a dozen or more people who were interviewed for management positions; all but two realized that the two women had no radio vision. The two that took positions are very sorry they did.

The first thing they did to "neutralize" WAQI was proof that that was, indeed, their intent. They thought that Miami needed a more balanced talk format and were wrong, but that was their intent from the very beginning.

Yes, it did. They immediately ordered WAQI to be more "balanced" in their perspective.

What happened is that nobody with real radio experience and success wanted to work for them. The moves they made on their own were poorly thought out, and convinced any valid and viable candidates for executive positions that there was no upside.

That is exactly what happened. Somewhere on the left, there arose a fear of Salem getting "all those stations" in important Hispanic markets. Those who pushed the project did not, obviously, know that programming could not be changed overnight. One person involved told me that they were told that "the programming could be quickly flipped, just like ABC and CBS and NBC start a 'new season" each time Fall rolls around."

The whole effort was to keep those stations away from Salem. The concept did not work for a variety of reasons.

WAQI was hardly a zero-audience station until they castrated it. Several stations, such as the Fresno and Las Vegas FMs had significant audience, and the LRGV cluster is very significant as was WAQI and the Chicago AM station.

You are a patient man, Mr. Eduardo.