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The Coming Cumulus Massacre of Citadel

SirRoxalot said:
Isn't that precisely what led to the dot-com bubble, Enron, the housing bubble, and the evolving foreclosure crisis? Isn't that precisely what put Citadel and Regent over the edge, and has Clear Channel sweating out covenants?
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So great...name a handful of examples that prove your point, and ignore the majority of business that hasn't fallen off the cliff.

Entercom and Townsquare are playing the same type of baseball. Townsquare is in a little deeper than Entercom. The fact is it's not just about the air signal any more. Citadel was terrible in the new media world, and Cumulus isn't much better. That needs to change.

I really believe that once the sale goes through, Cumulus will sell off assets. If it was up to me, I'd also donate a lot of the boat anchor AMs to minority owners. If they sell off the Buffalo cluster, who would buy? It doesn't matter what the "right price" is. Even if it's someone in the area like Galaxy, anyone who buys them won't be spending lots of money on personnel. At least not traditional salary w/benefits personnel. That's just not the future any more. And if people get fired, I hope they'll look to markets outside of Buffalo, because there are a lot more jobs beyond Lake Erie.
 
TheBigA said:
I really believe that once the sale goes through, Cumulus will sell off assets. If it was up to me, I'd also donate a lot of the boat anchor AMs to minority owners. If they sell off the Buffalo cluster, who would buy? It doesn't matter what the "right price" is.
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Maybe Charlie Banta would buy them. If, and that's a BIG if, they were for sale.
 
I'm sure he'd love to own WGRF for personal reasons.

But the one that fits his current strategy is the AM station in the cluster.

This is what his company's web page says: Principle Broadcasting, LLC is focused on acquiring AM and/or FM radio stations at low prices and coverting them into an ethnic brokered time model. Principle leases time to various ethnic and religious groups.
 
You're not uninformed enough to think that Principle is Charlie Banta's only broadcast interest, are you? Or that Principle is the only broadcast model that he's likely to pursue?

I have no idea if Banta & Co. would be interested or not, but I'm sure that the price would be the critical factor. Entercom would also love to swap 107.7 for a real full-market coverage FM - and might be willing to spin a couple of AMs along with it if they could keep two full-market FMs under the FCC cap.

There are other options, but nobody's going to overpay anymore, especially with the challenges radio that faces from other wireless technologies, and with the likelihood that Cumulus will drive down the value of the stations simply by mismanaging them.
 
The way that Larry Norton and his morning show crew will be "reassigned" or outright released will be an interesting situation to keep tabs on, as well as the negotations with Shredd And Ragan to move them over to 97 Rock and back to morning drive.
 
ThePickleReport said:
TheBigA said:
I really believe that once the sale goes through, Cumulus will sell off assets. If it was up to me, I'd also donate a lot of the boat anchor AMs to minority owners. If they sell off the Buffalo cluster, who would buy? It doesn't matter what the "right price" is.
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Maybe Charlie Banta would buy them. If, and that's a BIG if, they were for sale.
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Banta isn't the White Knight. Principle is but one of the companies he operates. His Millennium-New Jersey company had a rough time after acquiring properties at the high water mark before the bubble burst. Millennium was recently absorbed by Oaktree Capital, the same company that acquired Regent's foundering cluster in Buffalo. Town Square Media is an extension of Oaktree.

No company, let alone Charles W. Banta, is going to rush to the rescue and save Citadel's Buffalo cluster and its staff of legends from the evil jaws of Cumulus (at least not anytime soon.) Banta may have some dry powder, but he's not going to over-pay (whatever the that means) if the properties become available. Those presently employed at Citadel can only hope to ride out the storm. They've been through this before with Citadel. Cumulus will cut salaries. Staff will be reduced.

This closing is not being looked forward to by anybody in the ranks. Six figure personnel in sales and on the air will be the first to be cut or trimmed. With closing approaching, Lew Dickey's acquisition team has most likely performed the required due diligence and prepared the cut lists. Nothing personal, it's business. Just another day in broadcasting in the new millennium. Unfortunately.
 
I have nothing to add to this thread. I'm just amazed that no one has had anything to say on the Buffalo-Rochester board in more than 24 hours. Just want to make sure it's workin'!
 
I would like to thank the academy and all the little people who have brought me the honer of page 4, without your help I could not have achieved the recognition I so greatly deserve...
 
Farid & Co. will be justly compensated for saving the company. Management at the Buffalo cluster will receive retention bonuses for staying through the closing. No doubt the rank and filewill be compensated for their dedication as well.
 
So, you get a bonus for driving a company into bankruptcy, and losing the fight to retain your position after emerging from bankruptcy. At least somebody blew the whistle on the even bigger bonus that Farid tried to push through for himself.

He'll still get about $32-million as a parting gift. I'm sure that he'll share that with his loyal subjects who'll get 2 weeks notice when Cumulus comes in.
 
Refrained from commenting here, but today's (Friday, Aug 5, 2011) Taylor On Radio offers substantial food for thought, especially given the beating the market took yesterday:

“Cumulus was already having a hard time getting its debt together for the Citadel deal – and now this.” One dealmaker shakes his head and says this week’s tumble on Wall Street could make a number of radio deals harder to finance. Tops on his list is Cumulus buying Citadel for $2.4 billion. He says “When Lew Dickey finally cut that deal in March, it was a perfect storm of good interest rates, shareholder unhappiness with Citadel, a bunch of things. But everything’s shifted now.”

TRI has already pointed out the apparent pushback by Cumulus of the closing, now stretched to “by the end of the year.” Cumulus had originally hoped to finance almost all the $2 billion or so it needed in one giant gulp. Then it had to split that into two tranches. The first one, for about $600 million, was no problem. But the dealmaker says “the second one isn’t going to be easy. I question whether they’ll be able to get it done at all, the way they’re trying to do it.” One TRI reader who has been in touch with Cumulus corporate in Atlanta in the past month says the change from a closing “probably by the end of August” to “end of the year” is something new in the last several weeks.

The hang-ups could partly be regulatory. But the delay fits the scenario of trying to scrounge together the debt financing. And if Uncle Sam's credit rating is indeed dropped and credit gets tighter, that’s going to affect all kinds of radio operators.
 
JimPastrick said:
The hang-ups could partly be regulatory. But the delay fits the scenario of trying to scrounge together the debt financing. And if Uncle Sam's credit rating is indeed dropped and credit gets tighter, that’s going to affect all kinds of radio operators.[/i]
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A few years back, when Clear Channel went private, a few of their financial backers tried to pull out when market conditions changed. CC took them to court and the upshot was they had to deliver the money they promised.
 
There's a job opening for "morning show producer" at 97 Rock .... just posted on 8/3/11. The producer posting says the person will be doing sports reporting and working on Bills broadcasts. as well. Russ Burton has been doing this. Is he leaving or has he left?
 
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