Liberman Broadcasting has sold KHJ-AM 930 Los Angeles for $ 9,750,000 to IHA Educational Broadcasting. IHA is also buying KTYM-AM Inglewood.
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KHJ-AM 930 sold for $9.75 Million
- Thread starter Frequency1
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That's IHR, not IHA. Immaculate Heart Radio...Catholic.
Historical footnote: At least two former California Top 40 giants will be IHR after this deal is completed. KYA, San Francisco went to them years ago.
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K
K.M. Richards
Guest
Boy, are they overpaying.
Liberman must have overstated KHJ's signal reach considerably.
Liberman must have overstated KHJ's signal reach considerably.
Hmmm - does anyone happen to recall what 50,000 watt KFI was sold for to Cox Broadcasting back in the early seventies? I have a number in mind but would want to check it.
$15.1 million, highest ever.
Using one of the online present dollar value calculators, that is $86 million 2014 dollars!
This link has the Broadcasting article about the sale being approved by the FCC in April of '73
http://www.americanradiohistory.com...3-04-23-BC-OCR-Page-0023.pdf#search="kfi cox"
This link details the purchase after it was announced in mid-1972
http://www.americanradiohistory.com...-24-BC-OCR-Page-0014.pdf#search="kfi cox 15"
And finally, here is the full issue of Broadcasting that has the entire, 2-page article with lots of interesting KFI factoids.
http://www.americanradiohistory.com/Archive-BC/BC-1972/1972-07-24-BC.pdf
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The Encyclopedia of Broadcasting shows Cox paid Earle C. Anthony $15.1 million in 1973 for KFI. Adjusted for inflation, that's $80 million.
Beasley paid $86.6 million for KRTH AM (KHJ) and FM in 1989 ($160 million adjusted for inflation). Beasley flipped KRTH-AM to Lieberman almost immediately, but I can't find anything about the price of that transaction. David might know.
I'm a "small town kind of guy" when it comes to radio so in today's world just about all transaction prices 'stir my brain' to the point of being scrambled. BUT. This is not your typical commercial transaction. A church group is buying!
How do church groups value a station? Do they plan to broadcast primarily in English? Primarily in Spanish? If the signal reached out in another 20, 30, 40 miles, how much potential audience would that make available? Does the current signal coverage adequately reach the "target audience"?
Do you really thing the buyers are so gullible that they simply take the sellers word for coverage area? Is it possible that a group that owns a number of stations already either came to the table with some smarts, or in the process of acquiring their current group, maybe they were burned once before. I have to assume that a group that can put together a pot with over 9-million dollars.... is a group I would start the conversation by assuming that they may have hired an engineer (or the already OWN an engineer) that can evaluate a coverage map. Maybe before writing "The Big Check" or ever before signing the purchase agreement, I might have spent a day... or two.... or even 3 or 4 days just driving the extended reaches of the market and listening for myself.
So. What would have been a prudent price to pay... as seen from where you sit?
(The application on file with the FCC does not tell us who owns the real estate, what kind of lease may be involved, etc. The title of the documents mentioned but not displayed does not include one that has a title that would indicate ownership of real estate. You are are the scene. Tell me something. If some how we could acquire a permit to build a brand new station in that market, what would be the costs of carving out a bit of real estate where a tower could be installed in that part of town... even on a lease basis?)
$23 million. That is $44 million 2014 dollars.
KM Richards mentioned to me that the lay Catholic organization that bought it only broadcasts in English. It is a group with 41 stations and translators so far.
They also bought the Inglewood 1460 station for $6 million. I wondered if they might be thinking of a Spanish service on one of the stations.
KHJ recently sold its original transmitter site for development, and is triplexed on a site that has poorer ground conductivity and less well located. It still has a 5 mV/m signal over 10,000,000 people in the metro. Nights, when it is directional, it loses to the NE and north, but gains to the south. It's not a bad signal, but no KFI, KNX or KLAC.
Prior to today, I would have guessed in the $12 to $15 million range. I would have been high. But I don't have $400 million in debt, either.
The site is leased. It is the site for locals on 1580 and 1230, and triplexed.
Without adjusting for inflation, with the sale of the previous site and the sale of the station, I think LBI got as much as $25 million for the land and station.
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Lenard and 'Papa' have been selling off stations recently due to cash flow problems.....maybe the bank raised their rate??
Their cash flow covers only about 50% of the interest payments.
Now that's a serious problem. Another note - when KFI sold it included the first class studios on Vermont (originally built by Hearst for KEHE and a prospective nationwide network that never materialized) plus the strategically positioned multi-acre transmitter site in La Mirada. This sale contains nothing comparable.
Next thing you know they will be buying KABC, and KEIB... IHR wants to own the whole AM dial in California! That's probably what, the 10th acquisation in a year? This is much like how K-LOVE is on 400 FMs and Air 1 is on 350... waste of channel, waste of money, 0.0 rating in the PPM...
-crainbebo
-crainbebo
Perhaps IHR's goals for ROI are more intangible than what's found in the commercial market.
Those of us in Texas have been keeping a sharp eye on the Liberman stations in Houston and DFW. Some of the lesser properties here have already been sold off recently. Given Liberman's money woes plus the possible sale of Univision, interesting things could be on the way for Spanish language radio.
If Liberman is having difficulty servicing debt at current low rates, they are in massive trouble.
This is probably just the broadcasting geek in me, but perhaps this would be a good time to retire the KHJ call.
Los Angeles is actually the only market where they'll have overlap by having 930 and 1460. It'll give them 17 signals in California. They have 10 AMs ...in Bakersfield, Eureka, Leemore, Madera, Monterey, Sacramento, San Diego, San Francisco, San Luis Obispo and Stockton...one full-power FM in Greenville and four low-power FM translators in Homewood, Susanville, Sausalito and Truckee. So I don't see a master plan to own the whole AM dial in California.
PPMs aren't relevant in this kind of broadcasting. They're not going after spot sales. It's a ministry. Given that the majority of Christian broadcasting has been of the fundamental Protestant variety, a Catholic network of stations is an element of diversity.
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First, the EMF business model is not based on ratings, but donations. By that metric, they are perhaps the most successful broadcasting operation in America.
And in some markets where they are rated (they don't subscribe, so the publicly delivered 12+ or 6+ does not show them) they do extremely well... their Nashville station gets in the mid-2 share range.
Their concept is to get on any signal if they can, upgrade later if they can, or otherwise continue to add translators to fill in the white areas.
I had the privilege of working with His Eminence, Cardinal Rickets Landázuri in Lima, Perú. The Archdiocese of Lima built an AM and an FM in the early 80's. The AM ran like a commercial music station but ran 8 60" capsules about life, health and faith in stopsets of two units. The FM was commercial Beautiful Music. The FM paid for the AM (50 kw non-d on 660) and the ROI was "Return on Inspiration" rather than a financial goal.
The kinds of debt that LBI has are probably paying something like a junk bond rate... in the 8% to 10% range.
It will be interesting to see. IHR has changed the calls of most of the stations it has taken over thus far, including KYA, San Francisco, KOLO in Reno and KNUU in Las Vegas. But KCEO in San Diego, KWG in Stockton and KHOT in Madera were left alone.
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