Emmis Communications has ended its long-time rep deal with Interep and its D&R Radio Sales and moved over to Katz Radio Group. KRG will represent Emmis stations in New York, LA, Chicago, St. Louis, Indianapolis, Austin and Terre Haute, IN. The deal begins 10/1. It is another big loss for Interep, which has suffered several high-profile client losses to Clear Channel-owned Katz.
Said Emmis CEO Jeff Smulyan: "This was one of the most difficult decisions we’ve ever had to make. I have tremendous respect for David Kennedy and his team, and I greatly value his industry leadership and expertise. However, we have determined that this the right decision for Emmis going forward."
Interep CEO Dave Kennedy had this to say: "The relationship between Interep and Emmis has been long and mutually profitable…Each company is now at a stage in its development where strategic change is of great importance in defining its future. This decision, although very difficult for each of us, works in the best financial interests of both companies, and sets the stage for each to better accomplish its objectives."
"We have long admired Emmis’s reputation for broadcasting excellence, and we are delighted to enter into a partnership that we believe will create long-term value for both companies," said Stu Olds, Katz Media Group CEO. "Emmis CEO Jeff Smulyan and Radio President Rick Cummings have built a world-class radio operation, and I believe the strength and reach of our two companies allows us to offer advertisers the highest level of choice, service and accountability in the market."
Interep says Emmis was one of its top five clients and confirms 1) that there will be a contract buyout by Katz; 2) that Emmis was not at the end of its rep contract. So, the silver lining in this dark cloud is that the contract buyout will help Interep with its ongoing financial restructuring.
RBR observation: It has been no walk in the park to rep Emmis stations lately in New York, LA and Chicago, as their ratings have been falling on stations like Power 106 and Q101. So it’s more critical mass for Katz and Stu Olds – who may some day buy the rep firm from Clear Channel. The deal will put more dollars short-term in the coffers at Interep, where Kennedy and Chairman Ralph Guild are hard at work on a financial restructuring.