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For the similarly named television broadcaster, see Citadel Communications.
Citadel Broadcasting Corporation
Type Public (OTCBB: CTDBQ)
Founded 1984
Headquarters Las Vegas, Nevada, USA
Area served  United States
Industry Radio Broadcasting
Revenue $719,760,000 USD (2007)
Employees 4,430
Website citadelbroadcasting.com

Citadel Broadcasting Corporation (OTCBB: CTDBQ) is a Las Vegas, Nevada-based broadcast holding company. Investment house Forstmann Little & Company owns 27% of Citadel and is its largest shareholder.

Citadel owns 243 radio stations across the United States and is the third-largest radio station owner in the country. Only Clear Channel Communications and Cumulus Media own more stations. Farid Suleman is the current chairman and CEO.

The Wall Street Journal reported Dec. 11, 2009, that Citadel plans to file for bankruptcy by the end of the month.[1]It did so on December 20, 2009.

Contents

History

The company was founded in 1984 in Phoenix, AZ by Larry Wilson as Citadel Associates Limited Partnership. In 1990 it was renamed Citadel Associates Montana Limited Partnership for the purpose of owning and operating stations in Montana that were formerly owned by CALP. A year later, Citadel Broadcasting was officially incorporated and in 1992 it acquired all of the radio stations owned by its predecessors. Within a decade, Citadel expanded to 26 states. Within that time period, it absorbed all Bloomington Broadcasting radio holdings and 11 stations from Dick Broadcasting Company and also acquired 3 radio stations from Slone Broadcasting, Inc. and Slone Radio, LLC. In 2001, Larry Wilson sold Citadel to Forstmann Little for $2.1 billion. By that time, the company had grown to 205 stations in 42 markets.[2]

Citadel Broadcasting launched an online service called Citadel Interactive in 2005, and a year later launched Right Now Radio. By July 2007, more than 180 of their stations were streaming online.

On February 6, 2006, Forstmann Little and The Walt Disney Company agreed to merge Citadel with Disney's ABC Radio.[3] Shares representing 57% of Citadel were distributed to shareholders of The Walt Disney Company following the company's acquisition of 22 stations from ABC Radio.

After the merger, Citadel's ownership structure was:

  • 57%: Shareholders in The Walt Disney Company
  • 27%: Forstmann Little
  • 16%: Former Citadel shareholders exclusive of Forstmann Little or shareholders in Disney

ABC owned and operated affiliates of Radio Disney and ESPN Radio were not included in the merger agreement, nor were the actual networks.

In order to comply with FCC ownership limitations, Citadel has sold off twelve of its radio stations. Ten of the stations' licenses have been transferred to a newly formed trust company, The Last Bastion Station Trust, LLC. The two-station Cortland, New York, cluster was sold off prior to the merger in a separate transaction; WIII was sold to Saga Communications and WKRT (now WYBY) has been given to the Bible Broadcasting Network for free as a tax deductible donation.

However as of June 19, 2008; Arbitron has expanded Oklahoma City's market definition allowing Citadel to own 5 FM stations in the said area, at which time Citadel Broadcasting applied to re-acquire KKWD from The Last Bastion Station Trust, LLC with the FCC. According to FCC documents, KKWD was re-absorbed into Citadel's station portfolio on July 9, 2009.

On April 2, 2009; the staff of Citadel Broadcasting changed the name of "ABC Radio" to Citadel Media to reflect on its current ownership of the major network.[4]

In addition to Citadel Media, Citadel also owns the Arkansas Radio, Tennessee Titans Radio, Buffalo Bills and the Michigan Talk radio networks.

Becoming environmentally friendly

On April 16, 2008, Citadel Broadcasting became the first organization-wide radio company to join the Environmental Protection Agency's "Green Power Partnership Program" and committed $1 million (USD) in Educational Green public service announcements. In April 2008, ABC/Citadel's KGO-AM in San Francisco, California was installing equipment for broadcasing with solar power during the daytime hours.[5][6] The maximum rated output of the solar cells installed at the KGO transmitter site is a little over 7 kW, which under ideal conditions is about 15% of the 50 kW of electricity radiated by the transmitter during daytime hours.[1]

Company troubles

Since October 2007, Citadel has suspended nighttime HD Radio broadcasts on 10 AM stations due to interference complaints. Those AM stations switched their nighttime broadcasts to C-QUAM AM Stereo until Citadel and Ibiquity fix the problems.[7]

On March 1, 2008; the former Disney/ABC Radio stations in Citadel's portfolio has sustained severe financial problems and that same day, hundreds of personalities were dismissed.

On September 12, 2008; Citadel Broadcasting has received a notice from the New York Stock Exchange (NYSE) warning them that they will be facing a delisting after the company shares fell below the continuing listing criteria in the past 30 days.[8] On February 27, 2009, the NYSE carried out that promise. After an IPO of $20.67 in August 2003, and a high of $22.70 in December 2003, CDL closed at $0.01 on March 6, 2009.[9] Delisting happened on March 5, 2009;[10] its stock now trades on the pink sheets.

Since the delisting, the staff of Citadel Broadcasting no longer held conference calls and won't be issuing quarterly guidance, but Friday’s 10-Q filing at the U.S. Securities and Exchange Commission (SEC) says it expects to remain in compliance with lender covenants through 2009. But given the current conditions, it will be a hassle for the company to meet the benchmarks it has to hit in 2010, starting January 15 of that year. Citadel is carrying $2 Billion in debt following the June 12, 2007 deal with Disney for the ABC Radio properties.[11] Overall, Citadel's revenue fell almost 23%.[12]

There have been rumors that the cash-strapped Citadel Broadcasting will sell the 23 major radio stations it has purchased from Disney/ABC in 2007 to reduce its debt load. However, several factors have made this kind of deal impossible: the difficulty finding financing, and the loss of the cash flow to Citadel if the major station sell-off takes place.[13] While Citadel may sell some (but not all) of ABC's former stations, Bonneville International has expressed interest in 2 of Citadel's FM stations in the Washington DC cluster.[14]

In a quarterly Securities Exchange Commission filing, the company has disclosed the possibility of a Chapter 11 bankruptcy. The company, in the filing, says that it "does not expect to meet its covenant requirements under the Senior Credit and Term Facility as of January 15, 2010." The Wall Street Journal reports that Citadel worked on a "prearranged" bankruptcy package in which lenders would get ownership of Citadel in exchange for forgiving about $2 billion of the company's $2.76 billion-dollar debt.[15] The filing began on December 20, 2009. [16]

Employee poaching suit

In early 2007, Citadel Broadcasting filed a lawsuit against Peak Broadcasting, claiming Peak raided its staff and secured company information. Peak operated in the Boise, ID market after purchasing six radio stations from Clear Channel Communications. Citadel also owns six stations in Boise. The suit claimed that one of the former Citadel employees stole a computer disk with critical information after asking the Citadel IT person to help him copy information, which Peak then used to compete against Citadel in Fresno, CA, as well. Peak has denied the allegations, however the two parties have now reached a confidential settlement, which included an undisclosed payment to Citadel, according to the Idaho Statesman.[17]

Notes

  1. ^ http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=118948
  2. ^ "Citadel Broadcasting - Corporate History" Citadel's official website through Internet Archive (accessed January 14, 2009)
  3. ^ "Citadel to Buy Most of Disney Radio Assets," The Wall Street Journal, February 6, 2006.
  4. ^ ABC Radio Networks Changes Name To Citadel Media - Citadel Media (released April 2, 2009)
  5. ^ KGO: up-to-date progress on Solar Transmitter Project
  6. ^ "ABC Radio's Green Power"
  7. ^ Citadel Halts AM Nighttime IBOC Operation Amid Complaints (retrieved August 22, 2008)
  8. ^ Citadel Broadcasting Notified by NYSE of Non-Compliance with Continued Listing Standards - NYSE Euronext (retrieved September 15, 2008)
  9. ^ Yorke, Jeffrey (Feb 27, 2009). "Citadel to be Delisted From NYSE". Radio and Records (Media Week). http://www.mediaweek.com/mw/content_display/news/local-broadcast/e3ib4ab512be78d97091a9142268309f5b3.  
  10. ^ http://radioequalizer.blogspot.com/2009/03/abc-radio-owner-citadel-communications.html
  11. ^ Form 10-Q - Securities & Exchange Commission (released June 30, 2009)
  12. ^ "Citadel revenue falls 23% in the latest quarter, management shows concern about 2010" - Radio-Info.com (released May 8, 2009)
  13. ^ With debt a major issue, is Citadel planning a major station selloff? - Radio-Info.com (released August 12, 2009)
  14. ^ DCRTV.net (accessed August 18, 2009)
  15. ^ http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=118948
  16. ^ The Daily Docket: Citadel Files For Chapter 11 - The Wall Street Journal (released December 21, 2009)
  17. ^ Citadel and Peak settle Boise dispute over employee poaching - Radio-Info.com (retrieved June 11, 2008)

References

External links

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