It is celebrating its 26th year of serving Philadelphia’s Hispanic community, first at 900 kHz and since 2002 at its present home of 1310 kHz. In November 2016, it added an FM translator at 105.7 MHz, bringing the Latino community its first stereo home for Spanish Contemporary music in a decade.
Now, the owner of “Mega 105.7” is reviewing its assets and its profit generation, in the face of new competition from iHeartMedia. It’s not good: a bankruptcy filing was submitted to a federal district court in Fort Myers, Fla., several weeks ago. Now, the licensee has officially shifted to debtor-in-possession status.
The filing in the Middle District of Florida was submitted March 28 by Michael Sciore, President of Mega-Philadelphia LLC, licensee of WEMG-AM & W289AZ in Camden, N.J., each of which primarily serve Center City Philadelphia, the Latino enclave of Northeast Philadelphia, and the city of Camden. Mega-Philadelphia also owns Millville, N.J.-based FM translator W277BA.
“The Debtor anticipates that it will continue business operations in the ordinary course throughout the Chapter 11 process,” Sciore noted in a Form 316 filing made with the Commission on Thursday (6/16).
A preliminary Hearing is scheduled for 10am on June 29 at the U.S. Courthouse in Fort Myers.
WEMG, an acclaimed radio station honored across the years with Medallas de Cortez Awards, has come under extreme financial pressure from the COVID-19 pandemic and, following its March 2020 North American arrival, the launch earlier this year of a full-market Spanish Contemporary format by iHeartMedia at 106.1 MHz — WUMR, branded as “Rumba” to mirror the company’s Tropical-focused contemporary FM of the same name in Orlando. In April, WUMR lured Lizette Alicea to lead sales efforts; she previously spent eight years with Univision in Philadelphia.
The financial strain on Sciore was shared in a court filing made June 3. In 2019, Mega-Philadelphia enjoyed gross revenue of nearly $1.73 million. In 2021, it shrank to just $293,954.36. Net cash flow for March 2022 was -$10,795.64.
There were no unsecured creditors listed in the filing. However, three “Critical Vendors” were noted and will be paid “prepetition obligations.” Thus, the FCC will receive up to the amount of $10,935.07; Intertech Media will be paid up to $300; and Nielsen Audio will be paid up to $9,978.
Anthony T. Lepore, Esq. and Radiotvlaw Associates LLC have been approved by the court as Special Counsel.
What’s next for WEMG?
Sciore on May 7 successfully secured the court’s permission to employ Pittsburgh-based media broker Roger Rafson of CMS Station Brokerage. But, this does not indicate a sale of WEMG or its two FM translators. Rather, Sciore hired CMS “in order to explore sale opportunities” and to evaluate the stations’ business value, “thereby assisting the Debtors in critical tasks associated with guiding the Debtors” through its bankruptcy reorganization. That said, Rafson’s duties include “identifying prospective buyers” for WEMG and the two FM translators.
CMS will be paid at a rate of $120 per hour. His work began May 7 and concludes June 23. If the stations are sold, the fee will be included in his brokerage commission. The commission is 5% of the sale price falls between $500,000 and $3 million. If a price higher than $3 million is agreed upon, he’ll get a 7% commission. In the event a sale price doesn’t reach $500,000 CMS will get 10% of the sale price.
If there is no sale, Rafson’s CMS will be paid the hourly rate total, with a maximum of $4,200.
An emergence from Chapter 11 also involves discussions with Mega-Philadelphia’s primary secured creditor, Centric Bank, to negotiate consensual solutions to a plan of reorganization and/or “to test the mark for a potential sale of Mega’s assets, namely the stations.”
Despite Sciore’s financial woes with Mega, the station’s ratings are at a fourth-month high, reaching a 1.3 share in May 2022. WUMR earned a 1.6 share.
