The Partnership for Innovation and Empowerment (PIE) is a Washington, D.C.-based organization that describes itself as a non-profit organization focused on “encouraging innovation by empowering communities through educational and business building activities.”
One key goal is to help minority and disadvantaged communities to find equal representation. Enter Sheridan Broadcasting Corp., in the news of late for the hiring of Leroy Jones, Jr. as President of Sheridan Radio and its digital division.
Sheridan Broadcasting Corporation (SBC) is one of the nation’s oldest Black-owned broadcasters and has been in operation since 1972. With headquarters in Pittsburgh, SBC currently owns WIGO-AM in Atlanta. It is also the company that saw its 51% control in American Urban Radio Networks (AURN) and Black News go to the Chesley Maddox-Dorsey-led Access.1 Communications in May 2016.
Access.1 is controlled by Guggenheim Capital Partners. That’s the entity at the center of a “white paper” that serves as an outright attack on the financial investment firm.
As RBR+TVBR reported in May 2016, the fight for majority control of AURN played out in bankruptcy court. That’s where Sheridan Broadcasting Corp. landed some 44 years after its 1972 birth. General Counsel and Radio Division President Ron Davenport Jr. said that he hoped Sheridan would emerge from Chapter 11 with AURN.
That didn’t happen.
Instead, Guggenheim took total ownership interest in AURN, as 49% of the network created in 1991 was held by National Black Network Broadcasting — another Guggenheim-owned entity.
In 2012 NBN sued Sheridan, saying the latter was invoicing NBN several weeks before Sheridan incurred expenses, a charge Sheridan denied. The parties reached a confidential settlement in May 2015, and either party was given the option buy out the other for control of AURN.
Sheridan Broadcasting Networks made two payments and sought bankruptcy protection to get more time to make the third payment, Davenport told RBR+TVBR. NBN needed to raise $9.5 million.
“We did not raise that. As a result, we withdrew from the partnership,” he told RBR+TVBR’s Washington Bureau in 2016.
As far as Maddox-Dorsey is concerned, Davenport tossed the baton to Access.1.
Now, Davenport’s true views on the matter have come to light.
With PIE’s support, a five-page highly accusatory report drafted by Davenport and Jones slams Guggenheim, and Access.1. The title alone illustrates the lingering bitterness over the loss of majority ownership in AURN:
GUGGENHEIM KILLED BLACK NEWS: How a $250 Billion Dollar Hedge Fund Silenced the Last Black Owned Independent Media Network
Jones, who has been in his role for mere weeks, says he will be “formally requesting the appropriate Congressional Committees with oversight of venture capitalists, hedge funds, media companies and their practices to both investigate and hold hearings on the actions of these well-funded companies that have quietly silenced the voices of both our community and other vulnerable communities of color one by one.”
Meanwhile, in a slam against Access.1, the “White Paper” reads:
As a result of actions taken by an over-zealous former partner, Sheridan discontinued its network operations in 2017 and was forced to sell off all but one of its radio stations.
Davenport and Jones continue, “This result was not necessary and occurred not because of Sheridan’s hubris or anything that Sheridan did, but because Access.1 (NBN’s parent) borrowed too much and was only able to pay back one third of the amount due, leaving Guggenheim $70 million short. Guggenheim foreclosed on Access.1 and took a controlling interest in Access.1 and, knowing that Sheridan was the only party interested in buying NBN’s 49% interest, took steps to weaken Sheridan with protracted litigation to force Sheridan to pay an exorbitant price.”
With Congress in a lame-duck session through January, nothing will transpire for weeks — if ever.
But, the “White Paper” shows Davenport is still bitter over the loss of AURN.
Neither Guggenheim nor Maddox-Dorsey have offered comments on the White Paper. RBR+TVBR was unable to reach Guggenheim prior to deadline; a voicemail was left for Ms. Dorsey.