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| Washington Post photos |
Utah-based Deseret Management Corporation has entered into an agreement to sell 17 of its Bonneville International radio stations in four cities across the country.
DMC, a for-profit arm of The Church of Jesus Christ of Latter-day Saints, will sell stations in St. Louis, Chicago, Cincinnati and Washington, D.C., to Hubbard Broadcasting Inc. Under terms of the purchase agreement, the Minneapolis-based company will acquire the stations for $505 million.
According to a story by Dennis Romboy at Deseret News, the sale is expected to be finalized in April or May pending FCC and anti-trust approval. Neither company expects any snags.
“Bonneville has built all its media properties into profitable, well-managed media outlets in lucrative markets, which has made them attractive to many potential buyers through the years,” said Mark Willes, DMC president and CEO.
As part of the transaction, Bruce Reese, Bonneville president and CEO, and Drew Horowitz, Bonneville chief operating officer, will move to Hubbard Broadcasting.
DMC will retain its stations in Salt Lake City, which include KSL Newsradio (102.7 FM and 1160 AM), KSFI (FM 100) and KRSP (Arrow 103.5). It will also retain its seven Bonneville stations in Los Angeles, Phoenix and Seattle with their managers and staff.
Ginny Morris, who will become the chairwoman of the newly created Hubbard Radio LLC, called it an exciting opportunity for the company.
"We have long admired the good work, reputation and leadership of Bonneville International and its management team and feel honored to welcome these great stations into the Hubbard family of companies," she said.
"The radio business seems to be steady and strong and we don't see that changing in the future."
Willes said Hubbard Broadcasting is a well-respected business that represents many of the same values Bonneville embraces.
"We felt Hubbard’s long-term hold strategy was the right fit for these stations,” he said.
Family-owned Hubbard operates 12 television and four radio stations in Minnesota, New York and New Mexico. As result of the sale, Hubbard Radio will add 547 employees, bringing its full- and part-time workforce to 701.
"This is a big bite for us, but it's a business we know well," Morris said.
Hubbard approached DMC about buying the stations last August and negotiations proceeded fairly quickly. Willes said the sale price was higher than DMC expected.
"It was a strong price for us and a doable price for Hubbard because of the earning potential," he said. "The stations we're selling are very profitable."
Stations included in the sale are: WARH, WIL, WXOS (St. Louis); WDRV, WILV, WTMX, WWDV (Chicago); WTOP, WFED, WWWT, WTLP, WBHQ, WWFD (Washington, D.C.); WKRQ, WREW, WUBE, WYGY (Cincinnati). That stations comprise a variety of formats including music, news and sports.
Only a small amount of the sale proceeds will go to DMC because the value of the stations lie in their broadcast licenses, which are held by the LDS Church, Willes said. "Most of the funds from this go to the church."
Read more here.
Also read here:
Read the Bonneville press release here.
Read the Hubbard press release here.
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