• Get involved.
    We want your input!
    Apply for Membership and join the conversations about everything related to broadcasting.

    After we receive your registration, a moderator will review it. After your registration is approved, you will be permitted to post.
    If you use a disposable or false email address, your registration will be rejected.

    After your membership is approved, please take a minute to tell us a little bit about yourself.
    https://www.radiodiscussions.com/forums/introduce-yourself.1088/

    Thanks in advance and have fun!
    RadioDiscussions Administrators

CBS Radio to merge with Entercom

Taylor also had some news about the CBS-Entercom deal:

"An amendment to the terms just filed yesterday says that “The merger agreement can be terminated” by either company if it has not been consummated as of January 31, 2018."

So they recognize this deal has a long way to go. Speculation about sales and spin offs is a bit premature.
 
TheBigA said:
Exactly. There could also be some changes in ownership laws in the next year. The FCC Chairman has said he wants to look into it. A lot of things can happen that don't involve selling the station.
Click to expand...

I'm worried now that the CBS Radio-Entercom merger could be called off if they don't get the regulatory approvals by November 2nd, according to a recent SEC filing.
 
TheBigA said:
Taylor also had some news about the CBS-Entercom deal:

"An amendment to the terms just filed yesterday says that “The merger agreement can be terminated” by either company if it has not been consummated as of January 31, 2018."

So they recognize this deal has a long way to go. Speculation about sales and spin offs is a bit premature.
Click to expand...

Despite speculation of any post-merger changes if the deal goes through, I'm still bracing for impact.
 
miketheradioguy said:
True, but I've been bracing for impact ever since the bombshell news dropped on February 2.
Click to expand...

The only moderately interesting news on February 2nd was knowing who got CBS radio. We had known for several years that a sale was being sought. We just did not know The Who and how.
 
DavidEduardo said:
In today's "Tom Taylor Now" there is an article with the title, "No, iHeart’s not peeling off any stations. "

“If they’re holding things valued at 12-times cash flow, there’s no way they can sell stations for 7-times or even 8-times. Those assets are what generate the cash flow they need to service their debt.”

The article is intended to quash speculation that iHeart might sell some stations, a rumor based more on second guessing the recent belt tightening in certain areas than on reality.
Click to expand...

At least that debunks my previous claims that iHeartMedia would sell some of their radio stations.
 
Same article in Tom Taylor Now said swaps with Entercom were possible but don't expect any outright sales.

I still think this deal will close. Most deals have drop dead dates, and there's plenty of time to get it done. I can't think of any radio deal in the last 20 years that took longer than a year to close.
 
Kent said:
Same article in Tom Taylor Now said swaps with Entercom were possible but don't expect any outright sales.

I still think this deal will close. Most deals have drop dead dates, and there's plenty of time to get it done. I can't think of any radio deal in the last 20 years that took longer than a year to close.
Click to expand...

The ABC Radio-Citadel merger ten years ago did take more than a year to close. The deal was announced in February 2006, but didn't close until June 2007.

The drop dead date for the CBS Radio-Entercom merger is now May 2, 2018. As of now, The SEC should soon OK the merger, allowing the FCC and DOJ regulatory approvals to catch up.
 
DavidEduardo said:


The only moderately interesting news on February 2nd was knowing who got CBS radio. We had known for several years that a sale was being sought. We just did not know The Who and how.
Click to expand...

I did read that Alpha Media would've considered acquiring CBS Radio, that could allow Alpha to go public. However, since they own radio stations in mostly small markets, I consider Alpha to be the new Townsquare. In the end, the CBS Radio-Entercom merger made the most sense.
 
miketheradioguy said:
I did read that Alpha Media would've considered acquiring CBS Radio,
Click to expand...

As we've seen, Alpha is struggling to manage their purchase of Digity, which is why they have already sold stations to Dick Broadcasting. A $3 billion merger with CBS would kill them, even if they went public. Any IPO wouldn't raise enough money to cover such a merger. Adding assets to a company doesn't add value to the stock, as we've seen in multiple cases.
 
TheBigA said:
As we've seen, Alpha is struggling to manage their purchase of Digity, which is why they have already sold stations to Dick Broadcasting. A $3 billion merger with CBS would kill them, even if they went public. Any IPO wouldn't raise enough money to cover such a merger. Adding assets to a company doesn't add value to the stock, as we've seen in multiple cases.
Click to expand...

And... CBS was looking for a tax free deal, which depended to a great extent on finding a company that was already publicly traded so as to enable the possibility of a Reverse Morris Trust. The alternative, a straight sale, would have had extreme tax consequences due to the capital gains on the heritage stations.
 
TheBigA said:
As we've seen, Alpha is struggling to manage their purchase of Digity, which is why they have already sold stations to Dick Broadcasting. A $3 billion merger with CBS would kill them, even if they went public. Any IPO wouldn't raise enough money to cover such a merger. Adding assets to a company doesn't add value to the stock, as we've seen in multiple cases.
Click to expand...

I understand. Besides, Alpha Media mainly owns radio stations in smaller markets anyways, so I wouldn't consider them a suitor for CBS Radio's stations anyways.
 
DavidEduardo said:


And... CBS was looking for a tax free deal, which depended to a great extent on finding a company that was already publicly traded so as to enable the possibility of a Reverse Morris Trust. The alternative, a straight sale, would have had extreme tax consequences due to the capital gains on the heritage stations.
Click to expand...


Thankfully they found Entercom, and things seem to be moving forward with the merger as Les Moonves said the deal is going through the regulatory approvals, and expects the deal to close within the next few months.
 
miketheradioguy said:
Thankfully they found Entercom, and things seem to be moving forward with the merger as Les Moonves said the deal is going through the regulatory approvals, and expects the deal to close within the next few months.
Click to expand...

Moonves also says there's no reason to worry about tanking NFL ratings, and there obviously is reason to worry, so his public statements are at least partly sweet talk aimed at Wall Street's ears.
 
RadioPatrol said:
Update a word by Jim Cramer over the CBS/Entercom deal.
Click to expand...

Just to put it in context, Jim Cramer loves the Philadelphia Phillies even though they are one of the worst teams in baseball.

This is not to equate Entercom with the Phillies, other than they're both from the same town.

The reason Wall Street is skittish about this merger is the same reason Moonves sold the division. And Wall Street seems to like Moonves.
 
http://news.radio-online.com/cgi-bin/rol.exe/headline_id=b15229

Here is an update

CBS has launched its exchange offer to their shareholders in connection with the merger of CBS Radio and Entercom. Under the terms of the offer, CBS shareholders can exchange shares of CBS Class B common stock for shares of CBS Radio common stock (which, upon completion of the merger, will convert into shares of Entercom Class A common stock). The exchange offer is scheduled to conclude on the evening of November 16, the day after the scheduled special meeting of Entercom shareholders to approve the merger.

CBS Chairman/CEO Leslie Moonves stated that the exchange offer gives CBS shareholders "the opportunity to invest in what we believe will be a best-in-class radio company, with top assets and a terrific management team." In a memo to staff, Entercom President/CEO David Field agreed with Mooves, writing "We couldn't be more excited about the team we are building, the brands we will own, and the bold plans we have to enable the combined company to thrive in the future with big investments across many areas of our business to enhance our capabilities and firepower."
Click to expand...
 
Status
This thread has been closed due to inactivity. You can create a new thread to discuss this topic.
Back
Top Bottom