Steel City’s Chapter 11 Exit Ramp: 54th Street


BOCA RATON, FLA. — On November 14, media broker Michael J. Bergner of Bergner & Co., shared details of a plan for his client, Steel City Media, to emerge from debtor-in-possession status.

The plan was said to be “consensual” amongst the company and its “significant financial creditors” and calls for Pittsburgh-based Steel City to exit bankruptcy with a new balance sheet and with the Frischling family retaining equity control of the company.

A restructuring plan has just been filed with the FCC, and that’s exactly what Frischling’s two entities in Southwest Pennsylvania and in Kansas City seek to accomplish.

A Form 315 filing made Dec. 28 indicates that “WPNT Media Subsidiary LLC” is reforming as “WPNT Inc.” With the legal assistance of Mark Denbo of Smithwick & Belendiuk P.C., this new entity will see family patriarch Saul Frischling‘s voting interest drop from 52% to 16.67%. His percentage of assets in WPNT Inc. lowers from 52% to 34.84%.

For sons Gregg, Michael and Todd Frischling, their 16% individual voting interest in WPNT Inc. rises to 16.67%; their percentage of assets is reduced from 16% to 10.72%, respectively.

Taking the remaining 33% voting and ownership interest in WPNT Inc. is 54th Street Equity Holdings, a unit of New York-based Business Development Corporation of America.

WPNT Inc. is comprised of WLTJ-FM “Q92.9,” an Adult Contemporary station, and WRRK-FM 96.9, offering Adult Hits as “BOB.”

Concurrently, the Kansas City-based licensee controlled by the sons of Saul Frischling — MGTF Media Company — is being reconstituted.

Until now, Michael, Gregg and Todd Frischling each held 1/3 ownership and voting power in this licensee. Now, the brothers will each hold 20% of the voting power — and no equity interest in MGTF.

It is 54th Street that will hold 100% equity interest in MGTF Media, and will have 40% voting interest.

MGTF is comprised of CHR/Pop KMXV-FM 93.3, AC KCKC-FM 102.1, Country mainstay KFKF-FM 94.1, and “New Hit Country” KBEQ-FM 104.3.

This will put all of Steel City’s collective debt in the hands of 54th Street.

Neither 54th Street Equity Holdings nor its parent, BDCA, holds an attributable interest in any other broadcast station.

However, Lee Hillman, a director of BDCA, is also a director of HC2 Holdings — the rapidly growing entity buying up LPTV stations under the guidance of Philip Falcone and is presently the owner of the Azteca América network.

On the morning of March 20, MGTF Radio Company filed a bankruptcy petition in U.S. Bankruptcy Court for the Eastern District of Missouri. By day’s end, it became known that WPNT Inc. had been added to the Missouri petition.

Now, it is on track to exit Chapter 11 in early 2019. If so, it would mark the second company to seek approval of a reorganization plan through a bankruptcy to have emerged successfully; Cumulus Media did so earlier this year. Still awaiting court approval of its plan is iHeartMedia, while LBI Media is in the early stages of its Chapter 11 plan of action.

Bergner’s Gordian Broadcast Technologies LLC, a partnership between the media broker and Gordian Group LLC, a boutique investment bank specializing in “complex and
distressed financial advisory work,” advised Steel City on its reorganization plan.

Serving as Steel City’s legal counsel are Carmody MacDonald P.C. attorneys Robert Eggmann and Thomas Riske.

Of Frischling’s radio stations, KFKF-FM and KBEQ-FM are among the most notable, namely for their respective pasts. Some 23 years ago, Sconnix Broadcasting cashed out of its ownership of such radio stations as WQSR-FM in Baltimore and WMXJ-FM in Miami by selling KFKF to EZ Communications for $28 million.

At the same time, EZ agreed to purchase KBEQ-AM & FM for just $7.6 million from Noble Broadcasting, which had been shopping around KBEQ-FM for up to two years.

It made headlines in the Kansas City Star, as KFKF would wind up a co-owned property to KBEQ, giving EZ control of two Country stations in a market where KBEQ as Top 40 “Q104” famously put WHB-AM out of the Top 40 race through the late 1970s.