Market appears to be flooded with station inventory


Activity begets activity in the M&A world. With demand so heavy in the sales of the New York Times television group, ABC Radio, some surplus stations at CBS Radio and the ongoing sales of stations by Clear Channel (both radio and its entire TV group), other broadcasters have been drawn into the market. Nexstar put its entire television group up for sale, then a few days later LIN Television did the same. Lincoln Financial Group decided to hand out the for sale sign for Lincoln Financial Media, the former Jefferson-Pilot Communications, consisting of both radio and TV stations.

Then, just last week, News Corporation put nine of its Fox O&Os on the auction block. Also, now that Citadel has finished its 2.5 billion bucks acquisition of ABC Radio from Disney, broker Elliot Evers is seeking buyers for the 11 Citadel forced divestitures he holds in trust – and the company has indicated it will also prune some non-core markets from its portfolio. Univision's new owners have indicated that they expect to sell about a half-billion in assets, consisting of its record label operation and non-core radio stations. Oh, and by the way, once shareholders approve the pending buyout at Clear Channel, which now seems likely, it will have to divest some no-longer-grandfathered properties in some larger markets, including New York and LA.

What all this station inventory has not done is depress prices. Private equity is backing the principal bidders on every big deal. Multiples remain in double digits for anything in a decent market. It is an interesting cycle, with the new private equity players bidding fiercely, while the publicly traded companies are generally have to stay on the sidelines-except, of course, for those who are in the action on the sell side.