Nobody has anything to say...

[JohnW]

...about Clear Channel possibly selling?

 

[Yeziknoradio]

...about Clear Channel possibly selling?

I was just reading FMQB:

http://www.fmqb.com/Article.asp?id=294919

I wonder how things will unfold.

Keep this on mind though: (bottom of page)

"Clear Channel added in its statement that "there could be no assurance that this process will result in any specific transaction" and that it "does not intend to comment further publicly with respect to the exploration of strategic alternatives unless a specific transaction is approved by its Board."

 

[Bob1370]

What's going on, is that Clear Channel isn't meeting its own or Wall Street's expectations when it comes to revenue or profit in its core businesses, and isn't sure what to do about it. They're looking for advice from Goldman, Sachs.

There are a lot of possible avenues. They could try to cash out completely and sell the whole thing to another company for cash on the barrelhead, but other than Disney and CBS (both of which are partly divesting their own radio properties) who's got the cash? They could try a merger or leveraged buyout but if they end up holding a lot of someone else's stock or bonds, they're hostage to however well or badly the next management group runs it...not necessarily a good place to be in. They could try piecemeal sales of some properties the way CBS has done, and pare down a bloated portfolio while pocketing some handy cash--and that might be their best route right now unless they see someone with a boatload of cash coming along to take it all.

Trouble is, they waited about a year too long to do this. The economy is losing some steam, the slack retail sales picture which has also depressed ad revenue is a leading indicator of a possible recession--and any offer they get will take that into account.

Whatever happens, I can see them getting out of markets outside the top 30 or 40, in which case Rochester and/or Syracuse properties could well be on the block. If Clear Channel leaves it'll have a major impact on Rochester, and whether the next owner is local and well financed, or another smaller (and maybe heavily leveraged) out of town group, will affect the quality of what we get.

 

[Radknowski]

What's going on, is that Clear Channel isn't meeting its own or Wall Street's expectations when it comes to revenue or profit in its core businesses, and isn't sure what to do about it.

Like many companies in the broadcast sector, Clear Channel rode (rides) the wave and were (are) the darlings of investors. The last few years have been less charming. While the broadcast sector rose considerably this past week, it continues to lag other sectors. There's a lot of uncertainty. Investors and professional money people would LIKE to believe in radio, but the numbers have not been encouraging.

When companies such as Emmis talk about going private, doing stock buy-backs and CBS sells off what may be considered secondary and under-performing markets, you know there are serious issues and problems at hand. No amount of corporate-speak can cover these issues.

It would be nice if the guys wearing the $2 thousand suits stopped tyring to bullsh!t "the help." Many years ago at a staff meeting, a friend diplomatically but vigorously questioned one of the corporate guys about regarding share price, options, price v. earnings and leading cash flow. These are items that can be found in a company's SEC filings, 10Q and quarterly reports. It's painfully dull reading, but you don't have to have an MBA to at least get a snapshot of what's going on.

Mr. $2 thousand Armani tried to dismiss the questions. After all, what the hell does a DISC JOCKEY know about corporate finance. Less than three months later, the company announced it was being purchased by a larger company and the executive to whom my co-worker addressed questions was in line to get a juicy buyout deal. It so happened that one of the heavy hitters on Wall Street and a few people who managed investment funds disected the deal and exposed some financial inconsistencies. Mr. Golden Parachute still walked away with a lot of cash, but only about 25% of what he'd expected.

What people in the radio business need to understand is that from the mightiest CEO to the lowliest board-op (for the purpose of job description, not to demean the work of board ops), radio is running at critical margins, so critical that a bad book, a major storm, a spate of bad hires or resignations, can have a direct and negative affect on the company's bottom line.

There are a lot of GM's, Regionals and COO's who are treading water these days. Of course, when you're sitting in the corner office on the 30th floor, your shoes rarely touch the mud in the trenches and you get special perks... like throwing subordinates under the bus, blaming others for your bad decisions and the ultimate perk, deploying your golden parachute.

Trouble is, they waited about a year too long to do this. The economy is losing some steam, the slack retail sales picture which has also depressed ad revenue is a leading indicator of a possible recession--and any offer they get will take that into account.

What? The economy is great! The market's up, gas prices are down... ugh, don't pay any attention the housing market and the individual borrowing or credit default figures. OK... this isn't about politics, it's about radio.

REPEAT: Trouble is, they waited about a year too long to do this. The economy is losing some steam, the slack retail sales picture which has also depressed ad revenue is a leading indicator of a possible recession--and any offer they get will take that into account.

Precisely, further indication that the whole megalopoly platform is a house of cards, built on the greater fool economic theory, something the little guys sensed years ago, despite the pie-in-the-sky forecasts and prep talks of the industry mavens.

Whatever happens, I can see them getting out of markets outside the top 30 or 40, in which case Rochester and/or Syracuse properties could well be on the block. If Clear Channel leaves it'll have a major impact on Rochester, and whether the next owner is local and well financed, or another smaller (and maybe heavily leveraged) out of town group, will affect the quality of what we get.

Again, a salient observation and another "reason" for Clear Channel thinning the herd in Rochester, making the bottom line look more attractive to a possible suitor.[/Mike]