Entercom’s Acquisition of CBS Radio: The Price Revealed
The merger between Entercom and CBS Radio has marked a significant milestone in the American media and entertainment industry. This article will delve into the completion of the merger, the expansion of Entercom’s radio stations, its market position, the impact on radio formats, perspectives from leadership, future plans, CBS Corporation’s perspective, and the tax implications of the transaction.
Merger Completion
The merger between Entercom and CBS Radio has been successfully completed, resulting in the formation of a leading American media and entertainment company. Entercom Communications Corp. announced the completion of the merger, solidifying its position as one of the top two radio broadcasters in the country. With this merger, Entercom has become the number one creator of live, original, local audio content in the United States and a dominant force in news and sports radio. The merger holds great significance for both companies and the radio industry as a whole.
Radio Stations
As a result of the merger, Entercom has significantly expanded its nationwide footprint. Prior to the merger, Entercom operated 127 stations, but with the addition of CBS Radio’s portfolio, the number has increased to 235 stations. This expanded network of radio stations now covers 47 markets in the United States, including 23 of the top 25 markets. The merger has allowed Entercom to broaden its reach and enhance its presence in key markets across the country.
Market Position
With the merger, Entercom has solidified its position as the second-largest radio operator in the United States in terms of revenue. While iHeartRadio remains the leading radio operator, Entercom’s merger with CBS Radio has significantly strengthened its market position. This enhanced market presence positions Entercom as a major player in the radio industry, capable of competing with other media outlets for a larger share of advertising dollars.
Radio Formats
The merger between Entercom and CBS Radio has had a notable impact on radio formats across the country. One example is the transformation of New York City’s 92.3 AMP Radio to ALT 92.3 FM, bringing alternative rock back to the airwaves. This change reflects Entercom’s strategic approach to leverage the strengths of both companies and cater to the diverse preferences of listeners. The merger has allowed Entercom to offer a wide range of radio formats and provide a rich and varied listening experience for its audience.
Leadership’s Perspective
David Field, President and CEO of Entercom, expressed his excitement about the merger and the unique strengths it brings to the company. Field acknowledged the opportunities presented by the merger in various areas, including sports, news, music, podcasting, live events, and digital platforms. He emphasized Entercom’s commitment to providing outstanding experiences for listeners and compelling integrated marketing opportunities for advertisers. Field believes that Entercom’s increased scale and capabilities will drive meaningful growth and enable the company to compete more effectively in the ever-evolving media landscape.
Future Plans
Entercom has outlined significant plans for investments in its brands, people, capabilities, and innovation. The company aims to enhance its competitive position and capture a larger share of advertising dollars. Entercom’s commitment to growth and innovation underscores its determination to remain at the forefront of the media and entertainment industry. By leveraging its expanded network of radio stations and diverse content offerings, Entercom seeks to further solidify its position as a leading player in the market.
CBS Corporation’s Perspective
CBS Corporation views the spin-off of its radio business as a strategic move aimed at content monetization and creating value for its shareholders. The decision to separate CBS Radio from the broader CBS Corporation portfolio reflects the company’s focus on its core strengths and growth opportunities in other areas of the media landscape. CBS Corporation remains committed to delivering high-quality content and maximizing value for its stakeholders.
Tax-Free Transaction
The merger and exchange offer between CBS and Entercom were anticipated to be tax-free for participating CBS shareholders for U.S. federal income tax purposes. This tax-free treatment provided additional benefits to CBS shareholders who participated in the transaction. The tax implications of the merger were carefully considered to optimize the outcome for both companies and their respective shareholders.
Conclusion
The completion of the merger between Entercom and CBS Radio has brought about a transformative change in the American media and entertainment industry. Entercom’s expanded network of radio stations, enhanced market position, and strategic vision position the company for continued success and growth. The merger has created a leading American media and entertainment company, capable of delivering high-quality content, engaging millions of listeners, and providing compelling marketing opportunities for advertisers. This landmark merger underscores the dynamic nature of the radio industry and its ongoing evolution in the digital age.
FAQs
How much did Entercom pay for CBS Radio?
Entercom acquired CBS Radio in a merger transaction, which involved a stock-for-stock exchange. The transaction was valued at approximately $2.4 billion.
What was the significance of the Entercom and CBS Radio merger?
The merger between Entercom and CBS Radio was significant as it resulted in the formation of a leading American media and entertainment company. It positioned Entercom as one of the top two radio broadcasters in the United States and enabled the company to expand its nationwide footprint and market presence.
How many radio stations does Entercom operate after the merger?
Following the merger with CBS Radio, Entercom’s portfolio of radio stations expanded significantly. Entercom now operates a total of 235 radio stations across 47 markets in the United States, including 23 of the top 25 markets.
What is Entercom’s market position after the merger?
As a result of the merger, Entercom solidified its position as the second-largest radio operator in the United States by revenue. While iHeartRadio remains the leading radio operator, Entercom’s enhanced market position allows it to compete more effectively and capture a larger share of advertising dollars.
How did the merger impact radio formats?
The merger between Entercom and CBS Radio had a notable impact on radio formats across the country. It allowed Entercom to offer a diverse range of formats, catering to the preferences of listeners. For example, the merger led to the transformation of NYC’s 92.3 AMP Radio to ALT 92.3 FM, bringing alternative rock back to the airwaves.
What are David Field’s perspectives on the merger?
David Field, the President and CEO of Entercom, expressed excitement about the merger and highlighted the unique strengths it brings to the company. He emphasized Entercom’s commitment to providing outstanding experiences for listeners and compelling marketing opportunities for advertisers. Field believes that the expanded scale and capabilities resulting from the merger will drive meaningful growth for Entercom.
What are Entercom’s future plans after the merger?
Entercom has outlined significant plans for investments in its brands, people, capabilities, and innovation. The company aims to compete more effectively with other media outlets and capture a larger share of advertising dollars. Entercom is committed to growth and innovation, leveraging its expanded network of radio stations and diverse content offerings.
What was CBS Corporation’s perspective on the spin-off of CBS Radio?
CBS Corporation viewed the spin-off of its radio business as a strategic move aimed at content monetization and creating value for its shareholders. The decision to separate CBS Radio from the broader CBS Corporation portfolio allowed the company to focus on its core strengths and growth opportunities in other areas of the media landscape.