On the future of Citadel…

Matt Williams

How can we allow Citadel Broadcasting to be swallowed by the governments’ bailout projects?  A recent sector surging on Wall Street is broadcasting, but one company stands out for staying behind.  Right now the third largest radio broadcaster, Citadel Media, is valued at a mere $30 Million.  Investors fear the company will fall to its debtors in January because of a $150 Million cash requirement.  The irony is that two if its debtors are the largest recipients of the government bailout.  The three big lenders to Citadel (CTDB) are JP Morgan Chase, ING, and GE.  JP Morgan received $25 Billion from the government in TARP funds. They also took over Bear Sterns, and the government funded $30 Billion of Stearn’s assets.  That’s $55 Billion of taxpayer money to JP.  So JP is going to turn around to the third largest broadcasting agency and say they are in debt, and take over Citadel?  No. There's no way that will happen.  That would cause a huge outcry!  What happened to “forgive us as we forgive our debtors?” Or it could at least be, “forgive us as we allow forbearance to our debtors?”  These lenders managed to slip an additional 4.25-4.50% per year interest on their debt to Citadel during negotiations this year.  That’s $50 million a year added to the debt principle.  Isn’t there something wrong here?  How did that one slide? Does anyone else know this is happening?  That should be reversed.  In a struggling time they are tightening a noose on Citadel.  It gives us an idea of why they lent the money in the first place.  I will be contacting my senator shortly about this issue. It’s too great an injustice. The government HELPED these lenders, and they turn around and do this.

Did I mention that ING is Dutch?  They got $13 Billion from the Dutch government. So we are going to lose our American Broadcasting to the Dutch?  Not to mention the FCC limits foreign ownership to 20% of a U.S. broadcaster.

FCC guidelines already restrict JP from ownership in Citadel.  They own media in the same markets. We know what newspapers are involved and in what markets.  We will let the FCC deal with that issue.  General Electric already owns 80% of NBC, MSNBC, 26 television stations, etc.  Here’s a link to some of its media assets: http://www.ge.com/products_services/media_entertainment.html

The time will come when the truth about Citadel will come out. They have done everything to avoid restructuring. They have a positive cash flow. Investors should take an eye at that stock.  A political voice concerning the outcome of this company needs to be made before the governments' bailout projects decide. It's our tax dollars bailing out JP Morgan.  Not to mention all of the FCC regulations regarding ownership for these large companies in broadcasting.   Who cares that the stock of CTDB is worthless, look at what's happening here.  Citadel can stand on its own two feet.  It’s scary to think the third largest radio broadcaster would fall into these huge companies.  They will advertise and grow their businesses for free, we will be surrounded by their political opinions and agendas, and their empires will only grow larger if they absorb Citadel.

-- Matt Williams, personal investor / health care field