DavidKaye said:I'm told they did just fine. The only problem was that the owner paid way too much for the station at the height of price inflation for stations, so the mortgage was simply too high to make it work. The new owner paid cash ($6 million versus the original $33 million) and has no note to carry back. He could probably play tuba music and make money on the station now.e-dawg said:The only problem that I have with the old Energy 92.7 is that they played some obscured dance music that only the dance enthusiasts would know. Energy will have better ratings if it sounded more like 103.5 KTU in New York. Besides should the radio be the masses and not the niche format?
$6M is the initial investment. It will probably generate negative cash flow until ratings and revenues ramp up. Let's say that costs the new owner another couple of million, bringing his total upfront investment to $8M. Others have posted that the station billed $5M per year so, if he can run it for a cost of $4M a year, he will clear $1M profit annually on an initial $8M investment, a 12.5% return on investment (pre-tax). Not bad. Imagine what he'll earn if he can getter better ratings and thus, better revenues than what Energy got.