The once-great WABC selling for a paltry $12.5M is embarrassing To put it in perspective, the buyer, John Catsimatides, paid $18M for his NYC apartment a few years ago. If he runs WABC like he runs his Gristedes grocery stores, I don’t see WABC regaining its legendary past.
-
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
WABC selling for $12.5M is embarrassing
- Thread starter Lee Linwood
- Start date
Frikkin cumulus has so much debt they will take anything. Id rather they sold it to some guy in China.
Nobody is saying that it was under-priced. That seems like a reasonable amount, today, for a station that has no real estate and will have to lease both a studio and a transmitter site.
Example: KHJ in LA was bought in 1989 for around $25 million. It was sold a few years ago for around $8 million. But the land that came with the original purchase was sold for $57 million. So the owner made $25 million on the deal, even if the radio station had severely declined in value. The station diplexed on another antenna system and now rents.
No, it's really not embarrassing. It's the world in which we live today.
Related: If Catsimatides runs WABC with brilliance and vigor, I don't see WABC regaining its legendary past.
AM radio in 2019, my dude.
Cumulus wants to get out of New York City.....That's why the cheap price.
And it’s an AM station with a tolerable but not spectacular format and no viable alternatives. There’s no hidden value there to magically be unlocked.
BINGO! Other than brokered ethnic, what's left?
Serious answer, I don’t think there is anything. They’re in a multiway competition for talk. Other mainstream spoken word formats are spoken for elsewhere. So where would any justification for a higher price come into play? It’s a fair price for what the asset is and the potential return on investment.
The funny part is a lot of the same critics who feel this price was too low will also say that the big radio companies "OVERPAID" when they bought a lot of these stations. So which is it? You can't have it both ways. The one thing this station has in common with most of the others Cumulus has sold is it's a former Disney station. That tells me there are aspects of that deal that have made these stations difficult to run.
The price certainly reflects reality.
The reality is - the Dickey Brothers through terrible decision making ruined WABC and destroyed a large amount of its Going Concern value over a multi-year period. Sure, the station was going to lose value anyway (aging demos, money demo listeners pivoting to NPR, two all-sports stations becoming available on the FM dial, etc.), but dumping Rush and Sean for the likes of Geraldo and Rita Cosby and making life miserable for account executives was a recipe for self-destruction.
I'd start by saying the worst decision was he overpaid for Citadel. It wasn't worth $2 billion, but Lew was convinced he could fix it. He was wrong. The problems with Citadel were not fixed by bankruptcy. Then Lew's temper tantrum with Rush was probably ill advised. He ended up only losing the show in NY, but the fact is that the show hasn't helped him in Chicago or anywhere else. But my view is the ABC stations were in trouble when Citadel bought them, and they never improved. That's why they're being sold one by one.
Another thing that caught up with Cumulus was the change to the PPM starting in 2008. The AM talkers were considerably affected, as they were mostly low cume, high TSL operations which pretty much collapsed under PPM measurement.
When I was on various committees during the test phases of the PPM starting 6 years before, there were representatives of the larger groups... except Cumulus. The fact that they did not plan for change obviously meant that change was going to bite them.
Although they bought Citadel in 2011...so the writing was on the wall. That's why I say they overpaid.
I agree that Cumulus overpaid for Citadel big time. Lew & John had delusions of grandeur and desperately wanted their crappy company to be viewed in the same vein as CBS Radio and iHeartMedia (Clear Channel at the time).
The irony is - the incumbent Cumulus stations were already showing signs of stress.
John Dickey and Jan Jeffries literally thought they could hand program hundreds of different of radio stations themselves with minimal local input and deficient research. Post Citadel acquisition, remember John Dickey's "reverse crossover" gimmick he forced upon some of his company's country stations? Stations such as 96.3 KSCS in Dallas/Ft. Worth started to play a couple pure Hot AC-type songs an hour. This bit of programming idiocy sent the ratings crashing through the floor. Firing Jack Diamond & gang from Mix 107.3 in Washington in favor of a piped-in morning show from Atlanta (yes, I realize Bert Weiss once worked for Mix 107.3) was another example of programming brilliance. Within six months, what was once a perennial revenue powerhouse was completely ruined.
The irony is - the incumbent Cumulus stations were already showing signs of stress.
John Dickey and Jan Jeffries literally thought they could hand program hundreds of different of radio stations themselves with minimal local input and deficient research. Post Citadel acquisition, remember John Dickey's "reverse crossover" gimmick he forced upon some of his company's country stations? Stations such as 96.3 KSCS in Dallas/Ft. Worth started to play a couple pure Hot AC-type songs an hour. This bit of programming idiocy sent the ratings crashing through the floor. Firing Jack Diamond & gang from Mix 107.3 in Washington in favor of a piped-in morning show from Atlanta (yes, I realize Bert Weiss once worked for Mix 107.3) was another example of programming brilliance. Within six months, what was once a perennial revenue powerhouse was completely ruined.
I think that if they saw what was happening in the Philly and Houston tests and the early PPM results, they would not have bought the ABC stations. Particularly, they would have seen that the heritage AMs like KGO, which depended on high TSL and low cume and which were already on a decline, had tanked in the first PPM reports and they were not likely to recover.
That station in particular had an aging air staff with an audience to match.
Was Cumulus a big enough player, especially in the future PPM markets, prior to the Citadel merger to really care about the PPM? It seems like most of the major market holdings Cumulus owns came from Citadel.
Certainly by the time the Cumulus-Citadel deal came around, the writing was on the wall for many AM stations -- but also by then the PPM should have been well understood by Cumulus executives.
Certainly by the time the Cumulus-Citadel deal came around, the writing was on the wall for many AM stations -- but also by then the PPM should have been well understood by Cumulus executives.
Not sure about that. The Susquehanna purchase in 2006 got them into Dallas, Houston, Indianapolis, Atlanta, San Francisco, Kansas City, and several other majors. Those stations are still very successful and profitable now. Most of those were music stations, not AM talkers.
- Status