Purchase of ABC Radio
On February 6, 2006, Forstmann Little and The Walt Disney Company agreed to merge Citadel with Disney's ABC Radio.[7] 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—which was consummated June 12, 2007, Citadel's ownership structure was:
ABC owned and operated affiliates of Radio Disney and ESPN Radio were not included in the merger agreement.
In order to comply with FCC ownership limitations, Citadel sold off 12 of its radio stations. Ten of the stations' licenses were 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) was given to the Bible Broadcasting Network for free as a tax-deductible donation.
In December 2007, Citadel began broadcasting the morning radio show of shock jock Don Imus, just about six months after he had been fired by CBS for making racist and sexist remarks.[8]
On June 19, 2008; Arbitron expanded Oklahoma City's market definition allowing Citadel to own five 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 Federal Communications Commission (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 its ownership of the major network.[9]
In addition to Citadel Media, Citadel owned the Arkansas Radio, Tennessee Titans Radio, Buffalo Bills and the Michigan Talk radio networks.
- 57%: Shareholders in The Walt Disney Company
- 27%: Forstmann Little
- 16%: Former Citadel shareholders exclusive of Forstmann Little or shareholders in Disney
Company troubles
On March 1, 2008, the former Disney/ABC Radio stations in Citadel's portfolio faced severe financial problems. That same period, hundreds of personalities were dismissed as some stations over time changed formats—most notably to ABC Radio's in-house satellite network The True Oldies Channel.
On September 12, 2008, Citadel Broadcasting received a notice from the New York Stock Exchange (NYSE) warning them that they would be facing a delisting after the company shares fell below the continuing listing criteria in the past 30 days:[10] after an IPO of $20.67 in August 2003, and a high of $22.70 in December 2003, CDL had closed at $0.01 on March 6, 2009.[11] Delisting happened on March 5, 2009.[12]
Since the delisting, the staff of Citadel Broadcasting ceased holding conference calls and said they would no longer issue quarterly guidance; but their 10-Q filed May 7, 2010 at the U.S. Securities and Exchange Commission (SEC) indicated that Citadel expected to remain in compliance with lender covenants through 2009. Given the conditions, it was unlikely that the company would meet the benchmarks it had to hit in 2010, starting January 15 of that year. Citadel was carrying $2 billion in debt following the June 12, 2007 deal with Disney for the ABC Radio properties.[13]
Months after Citadel Broadcasting emerged from bankruptcy, it was approached by Atlanta-based Cumulus Media with two unsolicited merger offers, both of which Citadel rejected.[19] Then in February 2011, CNBC reported Cumulus was in "exclusive negotiations" to acquire Citadel. This third offer would be worth $2.5 billion to Citadel shareholders, some of whom were said to have already been pushing the board to consider a sale.[20]
On March 10, 2011, Citadel Broadcasting announced via email that it had been purchased by Cumulus Media in a deal worth $2.4 billion.[21] Some of the Cumulus or Citadel radio stations would, however, have to be transferred into a trust to comply with the FCC's ownership limitations, especially in those markets where Citadel already had a "grandfathered" over-the-limit station group.[22] Ultimately these included WELJ in Montauk, New York
