Two analysts have questions about the ramifications of Citadel’s purchase of ABC Radio and the ABC Radio Networks in a deal worth about $2.7 billion.
Robert Udowitz of BIA Financial Network said the purchase allows Citadel to move into much larger markets; ABC has stations in all of the top ten markets; prior to the acquisition the largest market in which Citadel had a station was market rank 36 – Providence, RI.
It’s interesting, he adds, that ABC retains the ESPN radio network and ESPN cable network. Overall, the combined companies will have good geographic distribution, Udowitz said.
Marci Ryvicker of Wachovia Capital Markets asks in a research note how would the new Citadel generate synergies with a platform that is diverse in cluster size and geography.
While Citadel “did get a fair price for these assets in our opinion, the transaction’s possible dilution and the potential lack of synergies leave us with a cautious view on the stock,” she notes.
Analysts Have Lingering Questions About Citadel’s Purchase of ABC Radio
Analysts Have Lingering Questions About Citadel's Purchase of ABC Radio