CEO David Field’s Memo to Staff Announcing Lincoln Approval and Bonneville Deal
July 14, 2015
I am very pleased to inform you that earlier today, the U.S. Department of Justice approved Entercom’s acquisition of Lincoln Financial Media. We have been given the greenlight to move ahead and will be closing on the stations sometime later this week or early next week. We will let you know as soon as the timing is finalized.
As you know, the Justice Department was concerned about the strength of our position in Denver with the combined Entercom and Lincoln stations. While we spent millions of dollars and seven months attempting to persuade them to approve the transaction as initially proposed, they remained unconvinced. As a result, we initiated conversations with a number of other broadcasters seeking a station trade that would reduce our position in Denver to satisfy the Justice Department so that they would approve the Lincoln transaction.
I am pleased to announce that we reached agreement with Bonneville to trade four of our stations in Denver for The Sound (KSWD-FM) in Los Angeles plus $5 million in additional consideration. We will be trading KOSI-FM plus three of the former Lincoln stations, KYGO-FM, KKFN-FM, and KEPN-AM. Frankly, this is a bittersweet event for us. We are very disappointed that we won’t be able to put the full group of these extraordinary Denver stations together to serve our listeners and customers. And it is particularly painful to part with KOSI and the wonderful team that have made it such a strong and successful brand over so many years. KOSI, and more importantly its people, will be deeply missed.
On the other hand, we are very excited to be entering the Los Angeles market, particularly with The Sound which is the fastest growing station in that market, featuring an outstanding talent lineup led by Mark Thompson, formerly of the Mark & Brian show. The station has leapfrogged into one of the market’s leading brands among Men and Adults. And while we won’t have all of the stations we had hoped for in Denver, we will still be strengthening our position in the market and will have an outstanding cluster featuring Alice, The Mountain, KQKS (KS107), KEZW, KRWZ, and the Comedy Channel. The Bonneville station trade will take effect under a TBA agreement that will begin on the same date as the Lincoln closing.
This is a tremendously exciting day for all of us in the Entercom family. Today we are taking a really big step forward to expand our company and create a multitude of new growth opportunities for our future. We are entering four new and outstanding top 20 markets: Los Angeles, Atlanta, Miami and San Diego, while enhancing our position in Denver. We are adding 14 new radio stations, including some of the most powerful, heritage brands in the country. We are adding hundreds of new, talented broadcasters to the Entercom family and adding millions of new listeners, giving us greater capacity to serve our customers. We will now be operating in every major market on the West Coast, and will reach listeners from Seattle to Miami and from Boston to San Diego with 125 of the nation’s most distinguished radio brands. Our increased size and scale makes us stronger in a number of ways and opens new doors of opportunity. And we were able to structure these acquisitions in a manner that enables us to remain one of the financially strongest companies in the business, preserving the capacity and flexibility to invest boldly in our company’s future.
Finally, one of the things that makes our company special is our culture. We are highly competitive and uncompromisingly committed to being the best at what we do, but we are also a decent and thoughtful group of individuals. For those of you who have friends at Lincoln or at The Sound, please pick up the phone or send an email and make our new colleagues feel welcome. I know they will really appreciate it.
In closing, I want to thank each of you for all you do to make our company special. We should all be truly proud of what we do to make a big difference in the lives of our listeners, our customers and our communities.
Enjoy this terrific day!