Citadel

This profile considers US radio broadcaster Citadel Communications Corporation.

It covers -

• introduction
• the group
• studies
• chronology

Introduction

As of June 2005 Citadel was the fifth largest radio broadcasting company in the US, based on net broadcasting revenue. It owned and operated 155 FM and 58 AM radio stations in 47 markets located in 24 states across the country, with its top 25 markets accounting for approximately 75% of revenue. At that it operated one FM station in the Knoxville market, one FM station in the Oklahoma City market, four stations in the Muskegon market, six stations in the Tuscaloosa market and one station in the Birmingham market under local marketing agreements.

In February 2006 Disney announced an agreement to merge its ABC Radio stations with Citadel in a deal that Disney valued at US$2.7 billion. Disney said it would spin off ABC's 22 radio stations and its ABC Radio Networks programming arm into a separate entity, which would then be merged with Citadel to make the transaction tax-free to Disney shareholders.

The expectation was that Disney shareholders will own 52% of the new company once the deal is completed, with Disney keeping up to US$1.65 billion in cash. The new company, to be called Citadel Communications, will own 177 FM radio stations and 66 AM stations.

The group

Citadel was founded in 1984 as as a limited partnership, Citadel Associates Limited Partnership (CALP).

In 1990 the partners established Citadel Associates Montana Limited Partnership (CAMLP) to own and operate stations in Montana formerly owned by CALP. Citadel Broadcasting Company was incorporated in 1991. The following year it acquired all the radio stations then owned or operated by CALP and CAMLP. In June 2001 affiliates of financier Forstmann Little & Co - a competitor of Hicks Muse Tate & Furst (HMTF), the money behind Chancellor and Capstar - acquired Citadel Broadcasting from its public shareholders for an aggregate price (including redemption of debt and exchangeable preferred stock) of around US$2.0 billion.

Chronology

1953 James Dick launches Dick Broadcasting with WIVK AM

1970 Bob Liggett Jr buys WFMK Lansing, forms what becomes Liggett Broadcast Group

1984 establishment of Citadel Associates Limited Partnership (CALP)

1988 Dick Broadcasting buys WNOX-AM

1990 establishment of Citadel Associates Montana Limited Partnership (CAMLP) to own and operate CALP's Montana stations

1991 Citadel Broadcasting Company incorporated

1992 acquires all radio stations owned or operated by CALP and CAMLP

1992 acquires four FM and four AM stations from Price Broadcasting Company

1992 acquires one AM and six FM stations from various parties, bringing total station count to 26.

1994 Citadel Communications Corporation formed as parent company, with Citadel Broadcasting Company as its wholly-owned operating subsidiary

1994 enters Albuquerque market with acquisition of two FM and two AM radio stations

1996 US Telecommunications Act of 1996 passed

1996 acquires further one AM and three FM stations in Albuquerque market and an additional FM station in Modesto and Colorado Springs for US$39m

1997 buys 61 radio stations (44 FM and 17 AM) for US$230m, including Tele-Media (WPRO AM-FM, WLKW, and WWLI), WDGE and WDGF

1997 Broadcasting Partners buys 3 FM and 1 AM station from Mercury Broadcasting in Buffalo for US$62m

1998 initial public offering raises US$106.9m

1998 acquires 11 stations (7 FM and 4 AM) for US$41m

1998 buys Wicks broadcast arm for US$77m

1999 sells 18 FM and seven AM radio stations in smaller markets to Marathon Broadcasting for US$26m

1999 buys Broadcasting Partners for US$190m

1999 buys Liggett Broadcast Group for US$120.5m

1999 announced or completed acquisition of 78 radio stations for approximately US$537m (inc Fuller-Jeffrey for US$66m), becoming 6th largest radio group in US country based on net revenues, fourth largest by stations owned

2000 acquires Bloomington Broadcasting Holdings (13 FM and 7 AM radio stations serving Grand Rapids, Columbia, Chattanooga, Johnson City/Kingsport/Bristol, and Bloomington markets) for US$175.9m

2000 acquires 11 radio stations from Dick Broadcasting Company, for US$289m (two FM stations in Nashville, three FM and two AM stations in Birmingham, four FM and one AM station in Knoxville)

2000 Liggett Communications (Radio First) buys WSAQ/WHLS from Wismer Broadcasting for $3.2m, buys WBTI/WPHM/WHYT from Hanson Communications for $2.24m

2000 buys WBTI-FM 96.9 Lexington, WPHM-AM 1380 Pt. Huron, and WHYT-AM 1590 Marine City from Hanson

2001 Forstmann Little acquires Citadel Communications Corporation for US$2bn including assumed and refinanced debt and preferred stock

2001 Citadel sells four radio stations in Monroe, LA to Monroe radio partners for US$4m

2001 pays US$24.5m to buy WXLO and WORC-FM

2001 sells three Atlantic City stations (and the right to operate one under a long-term marketing agreement) to Millennium Radio Group for US$19.4m

2001 buys three FM and two AM stations in Tucson, AZ from Slone Broadcasting and Slone Radio for US$66.3m

2003 pays US$16m for WWKX Woonsocket, WAKX Narragansett and WMOS Montauk from AAA Entertainment

2003 sells WCRQ for US$0.19m, WAHL and WCAT to Silberberg for US$0.8m, WKJN/WCWI/WAZL and WHYL for US$2.5m and WCWY for US$0.5m

2006 announcement of deal with Disney