CBS is not walking away from the Entercom/CBS Radio deal.
That’s one of the definite takeaways drawn by business analysts Marci Ryvicker, Eric Katz and Se H. Kim of Wells Fargo Securities after listening to CBS execs talk about the latest quarter on a conference call Monday evening.
“There are outs in that contract with appropriate fees,” they wrote, referring to the agreement to spin off CBS Radio into a merger with Entercom. But CBS management on the call “was firm that this deal will be closing in Q4.”
The analysts said the Securities and Exchange Commission has OKed all of the necessary filings; the remaining hurdle is Justice Department approval.
They highlighted that CBS Radio in the latest quarter outperformed Wells Fargo’s earlier estimates for both revenue ($306 million vs. $299 million) and adjusted operating income ($72 million vs. $64 million). These numbers were part of an overall sunny report from parent CBS Corp. “We literally spent an hour getting flowered with good news on CBS’ earnings call tonight (Monday) — which is a rarity these days,” the Wells Fargo analysts wrote.