Summarized by Kent Larsen
LDS Church's Bonneville Communications Swaps LA Station for 4 in St. Louis
(EMMIS Settles Sinclair; Swaps for Second L.A. Radio Station)
PRNewswire 22Jun00 B3
Deal with Bonneville gives EMMIS 2 FMs in Los Angeles
INDIANAPOLIS, INDIANA -- The LDS Church's broadcast arm Bonneville
Communications has signed a letter of intent to swap its Los Angeles radio
station KZLA-FM to Emmis Communications for four stations in St. Louis,
Missouri. The deal leaves Bonneville without a station in Los Angeles, the
nation's #2 radio market, but gives it four stations in St. Louis,
considered a top twenty radio market.
The swap makes sense because of changes in US federal regulations governing
ownership of radio stations. A Federal Communications Corp. rules change,
which raised the limit on the number of radio stations that a single company
could own in a single market, has led to a consolidation among radio
stations, with companies concentrating their holdings into more stations in
Bonneville has also actively sought to consolidate its holdings into fewer
markets, dumping stations in New York City, Texas and elsewhere to
concentrate its holdings in a dozen stations in Chicago, San Francisco,
Washington, DC, Salt Lake City, Cedar City, Utah and now St. Louis. Many
back-office tasks for radio stations, such as selling advertising and
managing transmission equipment can be consolidated when a company owns
several stations in a market, leading to significantly lower costs.
Bonneville president and chief executive officer Bruce Reese says that the
arrangement is better for Bonneville. He says owning four stations in St.
Louis, is "more compatible with our growth plans than the stand-alone
station in Los Angeles. We look forward to consolidating the four stations
in a single operations center."
The deal solves two simultaneous problems for Emmis, a publicly-traded
company based in Indianapolis. It helps Emmis resolve a dispute with
Sinclair Broadcast Group, Inc., over an option to acquire Sinclair stations
that Ennis acquired from a former Sinclair executive. It also gives Emmis
two radio stations in Los Angeles, putting it in a much better competitive
position in that market.
As with virtually all deals involving radio stations, the arrangement is
subject to the approval of the FCC, which is expected within the next 60 days.