On December 13, the tepid deal-making market received a bit of a welcome jolt with the news that The Walt Disney Company had decided to spin three top-market AM radio stations that have served as the longtime homes of ESPN Radio.
As part of the deal, the buyer would assume the longterm Local Marketing Agreement Disney has with Emmis Broadcasting for the operation of WEPN-FM, formerly WRKS, in New York.
Now, financial details regarding the transaction are known.
GOOD KARMA FOR A BIG SPORTS BRAND
Years ago, ABC sold off nearly all of its radio stations and its national programming arm, now part of the Cumulus Media family. Yet, it retained the ownership of three big-market AMs tied to ESPN, ABC’s sibling within The Walt Disney Co., as well as KESN-FM in Dallas and an AM in Southern California that had once been home to KRLA and, years later, Radio Disney.
With the FCC’s blessing, ownership WEPN-AM 1050 in New York, KSPN-AM 710 in Los Angeles and two-year LMA partner WMVP-AM 1000 in Chicago will be transferred to Good Karma Brands.
That’s the multimedia company based in Milwaukee led by Craig Karmazin.
GKB will also assume control of WEPN-FM 98.7 in New York, and the transaction is expected to close during the first quarter of 2022.
The purchase price is $15 million. Terms call for a $1 million payment at closing followed by $500,000 quarterly payments made until $14 million is handed to Disney. A $500,000 escrow deposit has been made by GKB.
GKB is the owner of some of the nation’s leading ESPN Radio affiliates, including WUUB-FM 106.3 in West Palm Beach-Boca Raton. Good Karma also owns ESPN Radio affiliates in Cleveland, and in the Wisconsin cities of Madison and Milwaukee. As such, there’s no fear for listeners that anything will change except the ownership of “ESPN 1050,” “ESPN 710” and “ESPN 1000” in the nation’s three largest markets.
The deal will also see GKB extend its ESPN Digital sales agreements, which began in 2015, in which GKB represents display and video inventory on ESPN.com and the ESPN App to local and regional advertisers in 14 select markets.
“We are thrilled to add ESPN New York and ESPN Los Angeles to GKB,” said Karmazin, who is the son of Mel Karmazin, co-founder and President of Infinity Broadcasting and a former CEO of Sirius Radio. “These stations and teammates give us an expanded footprint and increased resources to help meet our mission of serving our teammates, fans and advertising partners at a best-in-class level.”
ESPN Audio VP Scott McCarthy added, “At ESPN, we are focused on evolving to meet the ever-changing needs of our business, providing the outstanding content that our fans expect, and growing our audience in critical, leading markets. We have a strong, 20+ year relationship with Good Karma Brands and know they will further contribute to the success of these great local audio operations.”
Terms of the deal were not immediately disclosed; a Form 314 filing has not yet transpired.
KSPN’s license renewal application was submitted and granted in late November.
While Disney is selling the AMs, including KSPN, it still owns KRDC-AM 1110 in Pasadena, the former Radio Disney flagship and longtime home of pioneering Top 40 radio station KRLA. The property reportedly remains for sale and according to local reports mostly simulcasts ESPN Radio.
Meanwhile, RBR+TVBR hears that KESN-FM in Dallas is to be sold by Disney but not to GKB.
