Scripps Elects To Exit Radio Business

In a press release posted to the company website this morning, The E.W. Scripps Co. announced it is "creating a stronger, more streamlined and higher-performing company through comprehensive restructuring and cost reductions expected to yield more than $30 million in annual cost savings." It then revealed that it plans to sell its 34 radio stations across the U.S. and has retained Tucson, Ariz.-based Kalil & Co., Inc. to handle the process.

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This ought to make good old Frank Kalil's retirement a ton juicier.

Assuming all 34 Scripps stations are sold what would be an estimate of the total commission on a sale such as this?

gr8oldies said:

Who buys them in whole or in part? Does Entercom have room for more? Alpha seems a bit tapped out. iHeart likely isn't a candidate. Let the speculation begin!

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Here's an opportunity for small, local broadcasters to get back into radio. We read it all the time. People who want iHeart or Cumulus to be stripped of their stations, and sold to small, local broadcasters. Here's the chance to get some well-run stations in medium markets at good prices. How many local broadcasters will dig into their personal savings and buy these radio stations? Otherwise, it's just more of the same.

In the meantime, this dilutes the market even more, driving down prices, and making it even less attractive for Cumulus and iHeart to sell. The worst time to sell your house is when your neighbors are selling. That's what's happening in radio.

Scripps to sell radio division

The E.W. Scripps Company is selling their radio stations to focus on TV and digital.

If Alpha didn’t bite more than it could chew with the Digity acquisition, Scripps’ portfolio would be a perfect fit for them.

http://www.tvnewscheck.com/article/110688/scripps-plans-layoffs-sale-of-radio-stations

Here's an opportunity for small, local broadcasters to get back into radio. We read it all the time. People who want iHeart or Cumulus to be stripped of their stations, and sold to small, local broadcasters. Here's the chance to get some well-run stations in medium markets at good prices. How many local broadcasters will dig into their personal savings and buy these radio stations? Otherwise, it's just more of the same.

In the meantime, this dilutes the market even more, driving down prices, and making it even less attractive for Cumulus and iHeart to sell. The worst time to sell your house is when your neighbors are selling. That's what's happening in radio.

While we're still waiting to hear where Entercom will get the rest of the money from the CBS Radio merger divestitures, I have some thoughts if Entercom were to acquire some of the radio stations from Scripps.

Entercom should have room to expand in Milwaukee, since they only own 3 stations in that market, although a more logical transaction would be if Entercom could acquire the Milwaukee Radio Alliance stations, since they have an Alternative rock station, which is Entercom's favorite format. The only other market where Scripps and Entercom overlap is Wichita, where they both have maxed-out clusters. Otherwise, Scripps' stations could be a good fit for Entercom.

I hope it doesn’t happen, but Lew Dickey is sitting on a lot of dry powder...

When I think of a company that would be a good fit with these stations, the first one that comes to mind is Hubbard.

But I don't expect all 34 to go to the same company. A lot of these clusters are already self-contained.

miketheradioguy said:

...a more logical transaction would be if Entercom could acquire the Milwaukee Radio Alliance stations...

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MRA isn't going anywhere and they're not selling.

How about Bonneville and Cox are they good candidates for some of the Scripps Radio division? Some regionals? With Ebtercom? That is a strange candidate for the Scripps radio though.

34 Stations in smaller markets (#41, #62, #66, #71, #73, #97, #102 #135). The whole radio group is probably worth less than a the least valuable of Scripps TV stations.

And I'd guess they will have to sell piecemeal due to the ownership caps. Scripps' clusters are large enough in every market I looked at that a competitor already in the market could not swallow the Scripps group whole.

Most analysts think the Scripps markets will be broken up. Only way I could see Entercom getting the whole group would be if Bonneville picked up the tab and swapped them for the San Francisco and Sacramento stations it’s presently operating. There had been rumors that deal was structured as it was to find stations for Bonneville to swap so Entercom could avoid the tax consequences of a sale. Still seems like somewhat of a long shot, though. It wouldn’t likely be either's first choice for a swapping deal.

gr8oldies said:

It's not really an attractive package for any kind of national reach, basically just random markets.

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I agree. And if what they say is true, and the stations are "underperforming," it's even less attractive.

From RadioInk: "She also says it’s a tough call because the stations, inherited from Journal Communications back in 2015, have been underperforming “for quite some time.”

Is EMF already in these markets? If not, I'd expect the K-Love gang to pick off a few if the price is right.

CTListener said:

Is EMF already in these markets? If not, I'd expect the K-Love gang to pick off a few if the price is right.

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I don't. This group is organized around four and five station clusters. Each cluster is very self-contained. Easier to sell them as clusters than as one-offs. Plus EMF already owns stations in a lot of these markets.