RBR-TVBR Analysis
With the latest announcement that Randy Michaels’ Merlin Media is buying Family Stations’ WKDN-FM Camden/Philadelphia and turning it to all-News (similar to its Chicago and NYC properties), one has to wonder about Los Angeles being the next acquisition target. The megalopolis has two AM all-news stations in CBS Radio’s KNX-AM and Clark Radio’s KFWB-AM, but nothing in the way of FM News.
How would Merlin do the deal? Emmis is well invested in Merlin after its transfer of WKQX-FM (all News), WLUP-FM Chicago and WRXP-FM NYC (all News) to Merlin in June. Emmis received some $120 million in cash from the sale and continues to own $28.7 million of preferred equity and 20.6% of the common equity in Merlin.
Emmis’ KXOS-FM (93.9) is in a multi-year lease to Mexican operator Grupo Radio Centro, which has a purchase option on the station. It’s a possibility that Grupo Radio Centro isn’t doing all that well (currently tied for 30th in the market), and could be willing to assign their seven-year LMA and purchase option to Merlin/Emmis. On April 15, 2009, Emmis’ Adult Rhythmic Contemporary KMVN switched to Spanish-language KXOS.
Noted David Schutz of Hoffman Schutz Media Capital: “With New York, Chicago, and now Philadelphia; Los Angeles would appear to be the Missing Link in creating the foundation for a major market News/Information program service. Maybe Merlin could tap the KPWR sales and marketing staff so as to hit the ground in the nation’s largest radio advertising market, running.”
