Radio One Resumes Station Sell-Off
/Nation’s largest African American broadcasting entity exits Los Angeles market
Radio One Inc. continues its sell-off of various radio stations in an effort to shore up its fiscal strength. The nation’s largest African American radio entity and the nation’s seventh largest radio operator recently announced it will sell its Los Angeles station, KRBV-FM, for about $137.5 million to Bonneville International. With this move, Radio One (No. 11 on the BE INDUSTRIAL SERVICE 100 list with $413 million in revenues) will no longer have a presence in one of the largest radio markets by revenue.
According to a statement from Radio One, the sale will allow the firm to reduce its debt, focus on its new Internet initiative, and begin a $150 million stock buyback program. Radio One, based in Lanham, Maryland, trades on NASDAQ (ROIA) currently at a share price of $1.49.
Radio One owns and/or operates 54 stations in 17 markets targeting African American and urban listeners. The broadcasting company reported a 40% decline in profits in the third quarter of 2007 and has been selling off radio stations in non-core markets. In 2006, it announced the sale of $150 million worth of radio stations in underperforming markets.
According to Marci Ryvicker, vice president at Wachovia Capital Markets L.L.C., the sale of the Los Angeles station and the stock buyback plan should improve the company’s financial strength. "This station was a significant drag on the company’s margins. Radio One was unable to compete in Los Angeles, as evidenced by its declining share over the past 2-plus years," Ryvicker says. [MORE]
Radio One Inc. continues its sell-off of various radio stations in an effort to shore up its fiscal strength. The nation’s largest African American radio entity and the nation’s seventh largest radio operator recently announced it will sell its Los Angeles station, KRBV-FM, for about $137.5 million to Bonneville International. With this move, Radio One (No. 11 on the BE INDUSTRIAL SERVICE 100 list with $413 million in revenues) will no longer have a presence in one of the largest radio markets by revenue.
According to a statement from Radio One, the sale will allow the firm to reduce its debt, focus on its new Internet initiative, and begin a $150 million stock buyback program. Radio One, based in Lanham, Maryland, trades on NASDAQ (ROIA) currently at a share price of $1.49.
Radio One owns and/or operates 54 stations in 17 markets targeting African American and urban listeners. The broadcasting company reported a 40% decline in profits in the third quarter of 2007 and has been selling off radio stations in non-core markets. In 2006, it announced the sale of $150 million worth of radio stations in underperforming markets.
According to Marci Ryvicker, vice president at Wachovia Capital Markets L.L.C., the sale of the Los Angeles station and the stock buyback plan should improve the company’s financial strength. "This station was a significant drag on the company’s margins. Radio One was unable to compete in Los Angeles, as evidenced by its declining share over the past 2-plus years," Ryvicker says. [MORE]
