This is the big rumor in my inbox this morning from Tom Taylor.
It sounds 100% logical. Dial Global has been on the edge of going under for several years, in part because they are burdened by the debt they used to acquire Westwood One. They also are headed to court with TRN who has accused them of improper business tactics, acting as their station reps and then pushing stations to drop TRN and switching to Dial Global’s own products.
Cumulus is the force behind CBS Sports Radio – and has been quietly converting more and more of their music stations to carry CBS Sports – but they have a problem that they don’t have access to any live sports. Sports talk is the filler in between sporting events – it isn’t enough to carry a station by itself.
Westwood One has contracts with the NCAA for college sports and the NFL for football. The price to acquire Dial Global will be minimal – probably less than $100 million – but the risk to Cumulus is the cost of those NCAA/NFL contracts which may not be able to be covered by Cumulus’s ability to sell ads. I would not be shocked if this ultimately goes through some sort of restructuring to shed the debt and renegotiate the sports contracts.
Dial Global also distributes NBC Sports Radio – there are a few too many sports networks – some consolidation is inevitable
That would make room for HFRN, the House Fire Radio Network. Every day there are housefires, but no national network to talk about them as there are national networks dedicated to sports and weather. … it remains the fuel for local news… just waiting for HFRN to come along and do to them what Craig’s list has done for local advertizements.
We’ll need to incorporate youtube somehow, and have hourly foreat fire updates. Those redwood trees have survived 2000 years of fires, but if it wasn’t for the US Forest Service and professionsl fire fighters, they would surely bt consumed be the fires of hell!
We live in the FIRE economy as one of the charts in this excellent 3 part article shows:
http://www.zerohedge.com/news/2013-08-26/guest-post-trying-stay-sane-insane-world-part-3
BTW – Here is Amy Goodman via the same author.. A must see 2 min vid clip
http://www.zerohedge.com/news/2013-08-27/7-countries-5-years
This link works
http://amresolution.com/2012/10/25/46318/
No confirmation, no updates from TT
Tom Taylor seems to have an exclusive on this story. His current theory is that Oaktree Capital would give up its share of Dial Global / Westwood One. The current vale of the publicly traded part of the company is $17 million
The big player though is GE Capital, which manages the $436 million in debt. As of year end, the “owners” have -$61 million in net “ownership”, which probably explains why they voluntarily removed the stock from trading on NASDAQ.
Last year, they lost $146 million and their credit facility went into restructuring. $92 million of the loss was a paper loss – writing down the value of the “goodwill”. Their 10-K contains a “going concern” warning that the company was going to breach its credit arrangements and either have to restructure, declare bankruptcy or cease operations in 2013
I feel badly for Jim Bohannon.
The most recent bunch of loans are at 22.45%
Probably this is being driven by interest payments due at the end of the quarter. CBS also has a seat at the table – Westwood One was tightly coupled with CBS
22.5%???? Dangit, do their credit card limits go that high?
No matter what, Dial Global has realized their name has no brand identity, and will return to calling themselves Westwood One next week.
They should bring back the tones that everyone enjoyed on the Larry King radio show… back before Larry went to work for that Kremlin station he works for now.