Lincoln Financial

[mj]

How soon, and to who will the Lincoln Financial stations be sold to?

 

[And Awaayy We Go!!]

Maybe a private equity firm would buy them. The last time I looked at San Diego Arbitron numbers awhile back, Lincoln had a couple of their stations showing up pretty strong. The thing is that most buyers seem to be staying 100 miles away from buying a terrestrial radio stations altogether because the way things look now, the future of terrestrial radio is pretty bleak. However, they might have to convince just one person in a private equity organization to buy stations (the PT Barnum approach). That said, a private equity organization might want them.

 

[davideduardo]

Maybe a private equity firm would buy them. The last time I looked at San Diego Arbitron numbers awhile back, Lincoln had a couple of their stations showing up pretty strong. The thing is that most buyers seem to be staying 100 miles away from buying a terrestrial radio stations altogether because the way things look now, the future of terrestrial radio is pretty bleak. However, they might have to convince just one person in a private equity organization to buy stations (the PT Barnum approach). That said, a private equity organization might want them.

Private equity investment firms look for the same thing a mutual fund or an individual investor wants, a wll run, profitable company. Private equity does not want a piece of a company with no upper management. And they do not like single market plays.

The buyer will likely be some company already in SD but not capped out, or a company to which SD is a "perfect fit" market.

The thing holding back sales right now is the economy, not the future of radio. There is, actually, more demand than there are available station as we will see when the Aloha Trust stations of Clear Channel start going after the DOJ approves the transfer of Clear. Due to the economy, multiples will be lower, but there is plenty of interest in radio due to its profitability, wide margins and other factors.

 

[And Awaayy We Go!!]

The matter as to what's holding down the valuations of stations is quite complex and replete with speculation. There are many answers to that question, not only what you have stated but also what I have as well, along with many, many others beyond our imaginations. A person's reason for not wanting to pay for a certain price for a particular property has a lot of subjective variants tied to it. There are many answers.

 

[davideduardo]

The matter as to what's holding down the valuations of stations is quite complex and replete with speculation. There are many answers to that question, not only what you have stated but also what I have as well, along with many, many others beyond our imaginations. A person's reason for not wanting to pay for a certain price for a particular property has a lot of subjective variants tied to it. There are many answers.

In other words, just like buying a house or a yacht. Whatever.

You do not understand how private equity works, so I would not assume you would know how valuation works.

 

[Garrett]

Maybe a private equity firm would buy them. The last time I looked at San Diego Arbitron numbers awhile back, Lincoln had a couple of their stations showing up pretty strong. The thing is that most buyers seem to be staying 100 miles away from buying a terrestrial radio stations altogether because the way things look now, the future of terrestrial radio is pretty bleak. However, they might have to convince just one person in a private equity organization to buy stations (the PT Barnum approach). That said, a private equity organization might want them.

Private equity investment firms look for the same thing a mutual fund or an individual investor wants, a wll run, profitable company. Private equity does not want a piece of a company with no upper management. And they do not like single market plays.

The buyer will likely be some company already in SD but not capped out, or a company to which SD is a "perfect fit" market.

The thing holding back sales right now is the economy, not the future of radio. There is, actually, more demand than there are available station as we will see when the Aloha Trust stations of Clear Channel start going after the DOJ approves the transfer of Clear. Due to the economy, multiples will be lower, but there is plenty of interest in radio due to its profitability, wide margins and other factors.

David, I read a while back that CBS was looking to expand in markets like San Diego. Since CBS only has 2 stations in the San Diego market right now, would San Diego be a good fit for them?

 

[davideduardo]

David, I read a while back that CBS was looking to expand in markets like San Diego. Since CBS only has 2 stations in the San Diego market right now, would San Diego be a good fit for them?

It would be a good fit for them, and make the cluster much more competitive. Because the stations are likely throwing off a fair amount of cash, any buyer looking for a "stick" is not going to like the price, but for ongoing operations, they should be attractive to several operators.

 

[mteran5]

Will Lincoin Financial sell all five stations in one package, or divest them off each.

 

[davideduardo]

Will Lincoin Financial sell all five stations in one package, or divest them off each.

Only Lincoln knows. If they can make more money one way than another, they will probably pick the way that produces the most revenue.

 

[the golden boy]

I do think a sale is in the offing, but I don't know how soon. But who's to say Raycom won't by the LF stations? I say this because here in the southeastern US, Lincoln Financial Sports was recently bought out by Raycom Sports. They do TV play-by-plays of SEC and ACC football and basketball games. Also, this article in the Charlotte Business Journal from October did not state that Raycom would buy the other media properties, but it seems to keep the door open.

 

[SDRadio]

Do not be surprised if a local operator picks 'em up. <strong>Stay Tuned</strong> .....

 

[Bob_Hudson]

Do not be surprised if a local operator picks 'em up. <strong>Stay Tuned</strong> .....

You mean the guys who screwed up Z90 and 91X?

 

[mj]

that would be Clear Channel. Finest City made improvements to the stations.

 

[Bob_Hudson]

Finest City made improvements to the stations.

Not much.....

 

[John McNary]

You do not understand how private equity works, so I would not assume you would know how valuation works.

Worth repeating.