RADIO BROKER- GREAT TIME TO BE ONE

[joshzz]

I expect this year will be a great one for Media Brokers.

Companies that incurred large debt are going to have to lose stations soon... They're fighting not to but at some point they won't be able to stop the bleeding..

Citadel and Clear have made deals to keep things afloat but these patch jobs aren't going to hold and when it breaks, they'll be selling to anyone.. Finally, mom and pops will be able to get back in business.

Clear Channel in the last few years sold stations but they were only selling to group buyers. It was quite frustrating as we had targeted one particular station but in order to purchase it we would have had to buy a group of stations.. maybe now, their will be real opportunity.

 

[gr8oldies]

Assuming there are buyers when no one wants to finance radio stations. We have stations here that are in trust that have been ordered sold and no buyers...not even EMF

 

[joshzz]

DO you mean your stations or your employer's? We're looking to buy . you can me by email: [email protected]

this is not our station's email address but you can contact me thru that . please provide a contact phone number . josh

 

[gr8oldies]

Neither...stations Clear Channel has in the Aloha Trust locally

 

[joshzz]

If Aloha Trust was really interested in selling they'd be acting like sellers instead of being esoteric.

 

[GeorgeRReed]

It will be a great year for media brokers, but an even better year for station buyers. More inventory and the lowest prices in two decades.

George

 

[davideduardo]

It will be a great year for media brokers, but an even better year for station buyers. More inventory and the lowest prices in two decades.

Where is the financing going to come from? If it weren't for that, I'd take three or four!

 

[GeorgeRReed]

Look for seller financed deals.

 

[radioskeptic]

More seller-financed deals? Like the one for classical KFUO-FM in St. Louis, where the Lutheran Church Missouri Synod is unlikely ever to get the inflated $24 million that a local “Christian” broadcaster—which isn’t doing all that well with the two underpowered rimshots it has now—has promised to pay over a period of several years?

Tom Taylor has mentioned this question deal in brief items on his TRI newsletter a few times over that past months, but for a more complete account, see St. Louis Post-Dispatch music critic Sarah Bryan Miller’s blog:
http://www.stltoday.com/stltoday/ne...6F2ABF4A395F30298625769D000859D3?OpenDocument
http://www.stltoday.com/blogzone/culture-club/culture-club/2010/01/kfuolcms-more-on-thursdays-story/

Talk about “underwater” mortgages—here’s one in the making. Only this time it’s the seller who will be holding the bad debt if the sale goes through (though Cass Commercial Bank reportedly committed itself to making a $1.7 million loan for the down payment).

No reputable broker would take part in any such shaky deal. But this one was a do-it-yourself deal put together by LCMS board member Kermit Brashear, a Nebraska politician and lawyer, who stands to make a huge profit up front, whether the church that he represents gets what it expects or not.

 

[Nostalgia]

This information comes completely from a discussion I had with an owner who sold his station to a guy and held the paper. The new guy defaulted and he got the station back.

Depending on the sellers particular situation, if they dont need the big bucks right now to pay off their debt, this would be a good avenue for them. Works best for old time owner-operators not up to their eyeballs in first and second mortgages who just want to get out of the radio business. With a contract written properly they will hold the security interest in the tangible assets and continue to hold the license in their name until final closing. Really the buyers are LMAing the place with the money going toward the purchase price. If the buyer folds the seller gets the station back, gets to keep the money paid in so far with interest, and can try to sell it again. Under this scenario it would appear to be better than have a bank end up with the assets, something they really dont want except for the real estate perhaps, and the license dying. Remember, you cannot use the license as collateral to a bank, it is the FCCs to give and take back! Anyway, that is what I was told.

As for all the posters who keep hoping for a CC total melt down and fire sale sell off of stations, in my opinion that isnt going to happen. But even if it did like their earlier round of small market sales you would have to come up with the $$, no seller financing there! And as DavidEduardo points out, financing is scarce.

 

[fybush]

The only concern I'd have about the "seller-holds-the-paper" LMA-to-close is that, at least if you go by the letter of the law, the licensee is still supposed to have a paid managerial presence at the station...and is still on the hook for any fines incurred, too. So it's not quite a "hand over the keys, collect the cash and move to Florida" situation, if that's what you're looking for as a seller.

 

[Oldbones]

It will be a great year for media brokers, but an even better year for station buyers. More inventory and the lowest prices in two decades.

Where is the financing going to come from? If it weren't for that, I'd take three or four!

Pretty soft advertising market too. The stations being put on the block aren't the ones that are making money for the most part. Even in forced divestiture situations, it's the dogs of the cluster that are being put on the market, not the solid performers.