Likely, no immediate impact on local stations operations , but obvious indication the company’s in big trouble
Likely, no immediate impact on local stations operations , but obvious indication the company’s in big trouble
We can now begin speculating on why the investment banks took such a big haircut.Actually, now that they've knocked their debt down by 80%, I'd suggest they're no longer in big trouble.
Plus they're betting that Field can rebuild the company to where it was 5 years ago.My guess is that they looked at the liquidation value of Audacy (both as a whole and in bits-and-pieces) and decided that 20% of the debt was better than an alternative of even less... and far more predictable.
Correct. THAT is THE key question to ask. The answer Imo is company has little ongoing value or ability to generate cash to fund its debt.We can now begin speculating on why the investment banks took such a big haircut.
My guess is that they looked at the liquidation value of Audacy (both as a whole and in bits-and-pieces) and decided that 20% of the debt was better than an alternative of even less... and far more predictable.
The answer Imo is company has little ongoing value or ability to generate cash to fund its debt.
We'll probably never know, but part of me wonders if Joe will get more involved in decision-making, at least through the reorganization process.
Certainly, I'm not privy to Joe's condition, or whether he's in any position to provide guidance. For as much as many on this site like to portray David as incompetent, he's smart enough to know that his father built the business that's in trouble today. Sometimes going back to the oracle for advice is warranted. Realizing the industry is a lot different than the Entercom days, getting back to the old-fashioned financial basics and prudence can't hurt.On the surface, it would appear that the lenders were impressed with the fact that the Field family have a lot of heritage in the company, but the reorganization play, posted in the other thread, doesn't show a place for Joe in the new company. That's based on what we see right now, but things could change.
Sure. Take away our need to pay back what we borrow and pretty much everyone would be doing great. That sure does change the goalposts lol.It generates a LOT of cash. Just not enough to fund the debt. So now the goalposts have moved, and things are more in range.
Sure. Take away our need to pay back what we borrow and pretty much everyone would be doing great. That sure does change the goalposts lol.
Absolutely true..any of us can go bankrupt, yes.Like any business arrangement, both parties have agreed to this new arrangement, and it will be overseen by a judge, so apparently there are no hard feelings from the lenders. Any of us can declare bankruptcy if we choose.
Why would they "dump" any program element that produces ratings and revenue?Will they try to dump Red Sox broadcast rights ?
The Sox broadcasting rights cost a fortune. Ratings aren’t very good. I think it’s very clear they’d NEVER have done that deal if they knew they were getting a last place team 3 out of 4 years. They‘re Stuck with it for now…Why would they "dump" any program element that produces ratings and revenue?
It is very clear that this is a finance issue, not a radio station operational issue. The stations are profitable. As BigA said earlier, just not enough to pay the huge former loans.
The issue is not ratings or the team's standing... it is sales revenue. Sports generates dollars that no other radio format can produce. Part of this is due to sports marketing budgets of some advertisers which are not part of the regular "radio budget"... if there even is one. And the other part is that sports sells based on image much more than ratings.The Sox broadcasting rights cost a fortune. Ratings aren’t very good. I think it’s very clear they’d NEVER have done that deal if they knew they were getting a last place team 3 out of 4 years. They‘re Stuck with it for now…
The Sox broadcasting rights cost a fortune. Ratings aren’t very good. I think it’s very clear they’d NEVER have done that deal if they knew they were getting a last place team 3 out of 4 years. They‘re Stuck with it for now…
Correct. That’s all part of the halo effect of sports. It positively affects revenues in all day parts and builds ratings and image. That said—Audacy doesn’t do this deal if they know what they know now AND see the impact the Sox deal has had in recent years in every aspect you accurately mention. The price paid for value received hasn’t been what it WAS. Not by a long shot.The issue is not ratings or the team's standing... it is sales revenue. Sports generates dollars that no other radio format can produce. Part of this is due to sports marketing budgets of some advertisers which are not part of the regular "radio budget"... if there even is one. And the other part is that sports sells based on image much more than ratings.
And that's a whole different issue that's going to affect broadcast sports rights going forward. Stations and networks are pushing back at leagues and teams about the unbridled escalation of rights fees. Teams and leagues felt they could rely on jacking it to the broadcasters and networks to make up for escalating player salaries, but given a changing ad market, that assumption is proving to be unsustainable.Correct. That’s all part of the halo effect of sports. It positively affects revenues in all day parts and builds ratings and image. That said—Audacy doesn’t do this deal if they know what they know now AND see the impact the Sox deal has had in recent years in every aspect you accurately mention. The price paid for value received hasn’t been what it WAS. Not by a long shot.