Grupo Radio Centro has been running Emmis Los Angeles outlet KXOS-FM in an LMA-to-buy, and it will get a substantial discount if it closes by March 2013. It’s calling a board meeting to decide whether or not to pull the trigger on the deal.
The acquisition will have to be done 75% by proxy to conform to foreign ownership limits, and that proxy will be 93.9 License LLC, a subsidiary of Grupo Radio Centro LA LLC, headed by Carlos Aguirre Gomez.
The price for the station is $110M, but if GRC can close by 3/27/13, the price will drop all the way down to $85.5M. Emmis filed an amendment to its earlier transaction application stipulating the new arrangement 4/16/12.
GRC is holding a general shareholders meeting 8/3/12 to consider the deal, in which it will discuss authorizing the expenditure of as much as $95M to officially acquire the station.
GRC spelled out the agenda as such: “Discussion and approval of a transaction pursuant to which: (i) a company in which GRC holds a 25% share ownership and certain related third parties hold the remaining shares (the “Acquiring Entity”), will enter into a credit agreement with Credit Suisse and other financial institutions for up to US$95 million (the “Loan”) to finance the acquisition of the Los Angeles, California KXOS-FM radio station (the “Radio Station”) through the Acquiring Entity and its wholly-owned subsidiary; (ii) the Acquiring Entity and its wholly-owned subsidiary acquire the Radio Station in accordance with previous commitments of GRC with the seller; and (iii) GRC guarantees the Loan.Designation of delegates to comply with and execute the resolutions adopted at the General Ordinary Shareholders’ Meeting.”
RBR-TVBR observation: Our bet is that it will be thumbs up all around. No matter how much money you have lying around, $15.5M is still a hefty chunk of change. And it has been our experience dealing with the very rich is that one of the reasons they got and stay that way is they do not spend money at all if they can get away with it. And we suspect the board members at GRC are no different.
