RBR+TVBR INFOCUS
For a generation of broadcasters, the late Cecil Heftel helped bring Top 40 radio some of its earliest success. Later, he put WHYI-FM “Y-100” in Miami-Fort Lauderdale, and spent nine years in the U.S. House of Representatives as a Congressman representing Hawaii.
In the 1980s and 1990s, Heftel helped build some of the nation’s top Spanish-language AMs and FMs—with son Richard Heftel overseeing the Los Angeles station group.
Now, after nearly 20 years away from the radio business, the Heftel family has returned to AM and FM ownership. That’s thanks to a winning bid in a bankruptcy auction involving a broadcaster who has O’ahu in common, and one of the biggest bedding retailers in the Southwest.
On Monday, April 3, the U.S. Bankruptcy Court for the District of Nevada held an auction and sale hearing for the assets of The Drive LLC and KWHY, Inc..
These are the “Highway Radio” stations owned by Howard Anderson and run by President/COO Kirk Anderson that serve the stretch of Interstate 15 from Victorville-Apple Valley, Calif., north to Las Vegas.
Started in 1980 as “The Highway Stations,” Anderson saw much success and growth in the late 1990s. However, with the introduction of Sirius and XM Satellite Radio and the proliferation of personal entertainment devices, along with DVD players in family vehicles, the string of FM stations along I-15 began to lose their luster.
This led the Anderson family to consider several options. On Feb. 7, a decision was made to voluntarily file for Chapter 11 Bankruptcy Protection, with their 7 stations and Las Vegas-based booster transferred to a debtor in possession.
This led to the auction and sale, at which two bidders free and clear of liens, claims, and encumbrances emerged.
The highest and best bid for the properties came from a newly formed company with a familiar name to veteran broadcasting executives—Heftel Broadcasting Co.
Heftel’s winning bid was $620,000.
This awards Richard Heftel’s new entity the following KWHY Inc. stations:
- Class B KRXV-FM 98.1 in Yermo, Calif., serving an area from Victorville through Barstow and north to Baker, Calif.
- Class B KHYZ-FM 99.7 in Mountain Pass, Calif., and Class D booster KHYZ-2 in Las Vegas. With the booster, this station can be heard from Las Vegas south to Baker.
- Class B KHWY-FM 98.9 in Essex, Calif., which covers a stretch of Interstate 40 through Needles, Calif., in addition to the Laughlin, Nev.-Bullhead City, Ariz., area.
- Class B KIXF-FM 94.3 in Baker, Calif.
- Class A KIXW-FM 107.3 in Lenwood, Calif., a suburb of Barstow known for its quick-service restaurants and gas stations on the drive between Southern California and Las Vegas.
Heftel will also be acquiring The Drive LLC stations KHDR-FM 96.9 in Lenwood, a Class A, and KHRQ-FM 94.9 in Baker, a Class B1 facility.
The backup bidder, offering $525,000, is one of the most prolific buyers of FM stations in the last several months—Educational Media Foundation, operator of the “KLOVE” and “Air1” Christian Contemporary Music (CCM) formats.
“The Debtor made significant and satisfactory efforts to realize the highest and best value for the property, and the sale of the property was subject to overbids,” the court noted in a finalized asset transfer filing entered into the docket on May 5 and submitted to the FCC on Monday (5/22)
EMF will get the stations if, and only if, Richard Heftel and his new business partners default.
Such a scenario is highly unlikely, with the closing set to transpire between now and August 31. A Time Brokerage Agreement giving Heftel Broadcasting early control of Highway Radio has been forged and is pending Commission approval, Richard Heftel tells RBR + TVBR.
‘A WONDERFUL OPPORTUNITY’ FOR A RADIO RETURN
If your stations are financial and ratings success thanks to a Contemporary Hit Radio, or Top 40 format, you have Cecil Heftel to thank, in part.
In 1957, Heftel acquired KIMN-AM 950 in Denver, installing a “Top 30” format and introducing big-money contests and an “Action News” department. He sold the station three years later, and in the mid-1960s purchased KSSK-AM 590 in Honolulu—a hugely successful station that continues to this day as a simulcast partner to KSSK-FM 92.3, which Heftel snagged in 1979. Heftel sold KSSK-AM & FM in 1990; they are now owned by iHeartMedia.
Another station now owned by iHeartMedia is WHYI, which Heftel signed on in August 1973 as “WLQY” and is the longest-running Top 40 station with the same branding and call letters. Heftel acquired the FM for $1.5 million—a stunning sum at the time, even as WMYQ-FM 96.3, WZTA-FM 94.9 and WSHE-FM 103.5 were siphoning listeners from the AM band in the then-separate markets of Fort Lauderdale and Miami well ahead of the rest of the U.S.
Among the first Y-100 air personalities was Streamline Publishing CEO Eric Rhoads, who used the on-air moniker “Hymn.”
Heftel sold Y-100 in 1976, to longtime owner Metroplex Communications, led by Norm Wain and Bob Weiss.
In 1984, Heftel dove into the still-underdeveloped Hispanic radio arena, acquiring KTNQ-AM 1020 and KLVE-FM 107.5 in Los Angeles. He then partnered on ownership of WAQI-AM “Radio Mambi” and WRTO-FM 98.3 in Miami, and in 1993 created the nation’s largest Spanish-language radio company in the U.S. by merging with the New York-based Spanish Radio Network, giving Heftel WADO-AM in New York and WQBA-AM & FM in Miami. WQBA-FM is today top-rated WAMR-FM 107.5.
In May 1995, Heftel’s future in radio changed significantly. Clear Channel Communications, the iHeart predecessor, purchased $30 million in non-voting Heftel stock.
Roughly one year later, in mid-1996, Cecil Heftel departed as Clear Channel upped its investment and merged with Tichenor Media System, putting Mac Tichenor Jr. in control of what would eventually be renamed Hispanic Broadcasting Corp.
These assets today are a part of Univision Radio.
While the elder Heftel was out of the picture, Richard Heftel remained involved as President/GM of a Los Angeles cluster that saw a “new Heftel” in February 1997 acquire KSCA-FM 101.9 in Glendale, Calif., for a whopping $102.5 million from Golden West Broadcasters, the entity owned by Gene Autry.
Under the younger Heftel’s leadership, KSCA shifted from Adult Alternative to regional Mexican as “La Nueva 101.9,” with Renan Almendares Coello in morning drive as “El Cucuy.”
Two decades after “La Nueva” debuted, Richard Heftel is embarking on something new.
“These stations are the first,” he says of Highway Radio, alluding to the likelihood that additional acquisitions are forthcoming.
“I spent my whole life in broadcasting as part of the original Heftel, and this is a wonderful opportunity,” he says. “These are iconic stations, with huge potential.”
Richard Heftel’s partner with this new incarnation of Heftel Broadcasting is day-to-day partner Sean O’Neill and Larry Miller. Miller is famous in the Southwestern U.S. as the owner and CEO of mattress retailer Sit n’ Sleep; Sit n’ Sleep has been an active advertiser on radio since the days when The Howard Stern Show aired on KLSX-FM 97.1 in Los Angeles, and members of Stern’s “Whack Pack” did live reads for the retailer.
“We had an opportunity in the past to buy stations with four-times cash flow, but just couldn’t put it together,” Heftel says. Now, he has a group of stations that are geographically situated in a part of the nation that can allow him to participate as an active owner.
While Heftel is based in Provo (his father was an LDS Church member and attended the University of Utah for graduate studies), his main business activities through the 2010s have seen him as the head of Southwest Auto Brokers, which is headquartered in Las Vegas.
The first task for Heftel Broadcasting Co. is to improve the signals used for Highway Radio, he says.
All of the current formats — Rock, Country and Hot AC — are expected to remain in place. No staff changes are anticipated, Heftel adds.
The second task for Heftel is to attract national buys. Asked how he planned on accomplishing this, given the challenges seen by Howard and Kirk Anderson, Heftel said, “Recent Sit n’ Sleep spots have driven large purchases at the Victorville store. It’s not just people headed to Vegas [that respond], and we also have a more efficient way to reach Southern California. We’ve got some interesting data, and we want more ad dollars from larger advertising agencies.”
While there’s no guarantee when in bankruptcy court with respect to who will buy a station, the Anderson family is benefiting from the transfer of assets to a former competitor, and friend.
“I have nothing but respect for the Anderson family,” Heftel says. “They owned KRTR [in Honolulu] when we owned KSSK, and that helped us to be friends.”
With a friendly handshake, and a court order, Heftel has continued his father’s legacy.
RBR + TVBR
