Clear Channel Makes Deals to Sell 76 Radio Stations
Clear Channel agreed to sell 76 radio stations in 17 markets, putting the company a step closer to meeting a plan to sell hundreds of properties in smaller markets (CD Jan 22 p5). The stations are being sold to 7 companies, said documents from the broadcaster. The deals presage more sales soon by Clear Channel, said brokers. “I wouldn’t be surprised if in the next few weeks we see another 40, 50, 60 stations, maybe even more sold,” said BIA Vp Mark Fratrik. Clear Channel said Nov. 16 it was trying to sell 448 radio and 42 TV stations, separate from its $26.7 billion takeover by leveraged buyout firms.
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The deals are part of Clear Channel’s plan to bundle stations in multiple markets and sell them to one buyer, said radio appraiser David Schutz: “Clear Channel has a strong desire to minimize the complexity of the transactions, and is incentivized to sell in bulk.” Some buyers may turn around and sell unwanted stations to other local companies, said Schutz. The buyer of Clear Channel’s 7 Fargo, N.D. stations did just that. Radio Fargo has a deal to sell one of the stations it’s getting there, KFAB(FM), to Northwestern College, said an FCC filing by Clear Channel. That divestiture will allow Radio Fargo to comply with FCC ownership limits. Clear Channel exemptions to Commission ownership caps at other stations can be transferred to certain small business buyers, said a broker involved in the sale.
FCC approval for the transfer of 46 additional stations could come by midyear, Clear Channel Radio Pres. John Hogan indicated in a letter to station executives saying he expects the deal to be closed by that time. Blue Point Media agreed to buy those properties, in western cities including Casper, Cheyenne and Laramie, Wyo.; Pocatello and Twin Falls, Ida.; and Billings, Bozeman and Missoula, Mont. Blue Point executive Chris Devine may seek to amplify the signals of stations in smaller markets to enter larger, more urban areas, said Schutz. Devine has done that in other Western cities, including Denver and Salt Lake City, Schutz said: “He certainly does some pioneering things on the FM broadcast side.” Devine didn’t comment. Others with agreements to buy Clear Channel stations: Coosa River Communications for 2 stations in Gadsden, Ala.; Three Eagles, 4 in Lincoln, Neb.; East Arkansas Bcstrs., 4 in Jonesboro; Grand Eastern Radio, 6 in Lebanon, N.H.; and Rincon Bcstg., 7 in Santa Barbara.
There’s optimism that the divestitures will boost radio industry prospects because new owners will be more motivated to tweak music formats to better compete with satellite radio and online offerings, said industry officials including Schutz. Minorities bidding for Clear Channel properties may bring “fresh blood” to the industry if they're successful in buying stations, said broadcaster Michael Shumpert. “One of the things we need is more creativity,” said Shumpert, WOWE(FM) Vassar, Mich., owner: “There’s a school of thought that says radio is kind of in the doldrums right now,” so it could do “nothing better [than] to bring in some minorities.”