Wall Street snaps up broadcast bonds
Stock prices may be soft, but Wall Street is still hot for broadcast bonds. Both Clear Channel and Fisher Communications priced new bond issues yesterday with single digit yields. Demand was so strong that Clear Channel upped its planned 500 million dollar issue to 750 million in 10 year notes and priced it to yield 5.556% with a 5.5% coupon. Joint book-runners were Citigroup Global Markets and Wachovia Securities. Fisher's offering of 150 million in 10 year notes was priced at par with a coupon of 8.625%. Wachovia Securities was the sole manager.

BroadCap looks at station investments
Hank Torbert, the EVP/COO of Broadcast Capital Inc., appeared at the National Association of Black Owned Broadcasters session of station trading and finance last week (9/10/04), and provided a wealth of information on the ins and outs of financing station acquisitions in particular, and, really, anything in general. This will be a return to Fin101 for some, but for you PDs and for anyone else with nothing to do during the latest deal freeze, lets go through some of Torbert's info. Every once in a while we hear about layers of financing. Torbert has provided a guide to just what those layers are. The first two are equity only (based on future cash flows); the others can be equity of debt (based on existing cash flows). Here goes:

Correction: Yesterday we said that Valdosta GA was 6 miles northeast of Tallahassee. We meant 60 miles. Oops.

Radio stocks followed the market lower, spurred on by a negative report from Lehman Brothers (see Radio News). The Radio Index fell 3.611, or 1.7%, to 214.138 - - a year-to-date low. Citadel plunged 5.8% and Entravision 4% as traders sold broadcast stocks.

We want to
hear from you.
This is your column, so send your comments to [email protected]

We are honored by feedback like this.

I have never bothered to contact you and express my appreciation for the super job that is done to keep me (all of us?) so informed as to broadcasting situations and events. For that, I apologize, because admittedly, I have used information gleaned from your reports many times.

Rated New Mexico Market AM
Fabulous Potential!
Cliff at Clifton Gardiner & Co
(303)758-6900
[email protected]

Martha heading to jail

Congressman wants probe of CBS

Yahoo! Buys MusicMatch
for 160 million

XM adds online service for subscribers

The following brokers will be attending the NAB. Call or email to make your appointment in advance.

American Media Services,
Todd Fowler, Office 843-972-2200, Manchester Grand Hyatt, [email protected]

Cobb Corp.,
Denis LeClair [email protected]
Joel B. Day
[email protected]
Office 202-478-3737,
Manchester Grand Hyatt

Gordon Rice Associates,
Gordon Rice,
Office 843-884-3590,
Manchester Grand Hyatt,
[email protected]

John Pierce & Company LLC,
John Pierce, cell 859-512-3015,
Jamie Rasnick, cell 513-252-1186, Office 859-647-0101,
Manchester Grand Hyatt,
[email protected]

Kozacko Media Services,
Dick Kozacko,
Office 607-733-7138,
Cell 607-738-1219,
Manchester Grand Hyatt, [email protected]

Patrick Communications,
Larry Patrick, Office 410-740-0250, Manchester Grand Hyatt, [email protected]

Complimentary Report
No more Forward Pacing Reports.
We have the economic, political, and close up look at your 4th quarter of business and what must be done to hit budget by year's end.

GM of Cadillac, Mark LaNeve
tells it like it is on where he
spends ad dollars.

Read RBR in 2 simple steps:
1.Create a simple account with Zinio and download the free Zinio Reader.
2. You can then download the free August Issue of RBR

First reported here
in Tuesday's Bulletin
Consolidation within the Consolidator: CCU merging Premiere and CC Advantage operations into Katz
Clear Channel is putting Premiere Radio Networks and Clear Channel Advantage under Katz Media Group CEO Stu Olds. Premiere will keep its name, but CEO Kraig Kitchin will report to Olds. CC Advantage will merge with Katz Dimension, with the whole thing to be called Clear Channel Katz Advantage. It's not really a complete merger, but a lot is changing. Here's how it's going down: Premiere Radio Networks is not going away, but will have more interaction and direction from Katz Radio Group. RBR Observation: Katz has no history in programming. The original TranStar Radio Network (now part of Westwood One) was lost on Stu Olds' watch. CCU has still never successfully consolidated all the pieces of their empire - - Outdoor, Internet, network radio, concerts and spot. Perhaps this is another attempt at it. CCU is the only company that has the potential to compete on a national level with the Yahoos, the MTVs, etc, in order to put demand-side pressure on the inventory. Until they can do this, this industry is going to flounder. The question: are Stu Olds and Bonnie Press the people who can do this? 09/15/04 RBR #180

The Consolidator pt 2:
So, what's the motivation?
What does Clear Channel gain?
One industry source explained it: "I think Katz was off about 15% in July and off dramatically in August. Those businesses are off, the networks are off, everybody is off. They're looking for ways to cut costs. Another issue is these big buying agencies just can't comprehend this dinosaur-like way that radio is purchased. And agencies don't like to staff up for that heavy stuff. When you buy network TV, you get one bill and you pay one check. With radio, you have to cut like 200 checks and have a whole floor of people just doing paperwork. Clear Channel is the biggest operation in our business and they may be looking at some way to combine network and spot. I'm also hearing that Clear Channel may be coming up with some sort of Hispanic network. RBR Observation: They're taking all the Premiere stuff and putting it as part of Katz and it's going to be a competitive thing that Interep right now doesn't have. Radio needs to create some excitement. They've got to make radio relevant and this is one big attempt. They're thinking if they combine Premiere and Katz together, Premiere will have some new synergies.
09/15/04 RBR #180

Greater Media CEO says radio
has a greater mission
CEO Peter Smyth isn't taking an attack on the radio industry by Barron's magazine lying down. Smyth has sent the magazine a letter stating that he and many other broadcasters haven't been complacent, as the article alleged, in the face of technological and demographic changes. And he says that radio broadcasters are still developing new formats and working to better serve their local communities. Read his letter to the Barron's editor.
RBR observation: Barron's has already printed two letters responding to the article - - and the vote is an even split but the real bottom line is radio has a major crack in its wall and only some many fingers to plug the whole.
09/15/04 RBR #180

Radio One deal under attack
Robin M. Rothschild has challenged the license renewals of several Radio One properties in Ohio, and while that challenge is lending, is further challenging the group's qualifications as a suitable assignee of WABZ-FM Albemarle NC, which it has filed to acquire from Susquehanna and move into the Charlotte market. Rotchshild, though counsel Lee Shubert of Katten Muchin Zavis Rosenman, charges that license subsidiaries of Radio One "...have lacked candor and misrepresented facts in connection with the License Renewal Applications." 09/15/04 RBR #180

RBC warns investors of
soft radio revenues
David Bank is warning investors that radio revenues are pacing behind his previous expectations for Q3 - - and that Q4 is worrisome as well. In a note which headlined that Q3 for radio came in "like a lamb" and appears to be going out the same way.
RBR observation: Heads up people because the fourth Q is at risk. Now you can not point any finger at Naples, FL or Barron's or Forbes. Best read further on.
09/14/04 RBR #179