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Radio Transactions Are at Near-Historical Lows

S&P Global puts value of U.S. radio station sold at $190.2 million

The year 2021 was a quiet one for U.S. broadcast transactions, according to a new report, and radio station deal values were at their lowest point in at least 40 years.

According to a market deal recap, S&P Global Market Intelligence found that while broadcast station advertising revenue rebounded from the hit it took in 2020 due to the COVID outbreak, the station transaction market is sitting at near-historical lows.

Total TV and radio deal volume for 2021 was $4.72 billion. Radio represented only 4% of that; $190.2 million is the lowest value for radio transactions in the company’s records, spanning four decades.

The four largest radio station deals were driven by three of the country’s top-10 TV station owners.

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In June, Sinclair Broadcast Group announced the sale of its only radio stations to Lotus Communications for $18.06 million.

And late in the year, The Walt Disney Co. received $24.25 million for its remaining radio stations: VCY America will pay $9.25 million for KESN(FM) in the Dallas–Ft. Worth market, while Good Karma Broadcasting will pay $15 million for Disney’s AM stations in New York, Los Angeles and Chicago, along with an LMA for Emmis Communications station WEPN(FM).

Of the TV/radio broadcast total, about $4.2 billion or almost 93% came from the top two deals and their spinoffs.

In February 2021, Gray paid $925 million to Quincy Media for two TV stations and two radio stations. In April, Gray then sold 10 full-power and three low-power stations from the Quincy acquisition to Allen Media Group for $380 million. In May, Gray then announced the acquisition of Meredith Corp. and its 16 full-power and 30 low-power TV stations for $2.82 billion.

For the third year in a row, the average cash flow multiple for radio transactions remained stable at 6.6-times forward buyers broadcast cash flow. “In our estimates, only 25 full-power radio stations were sold based on their cash flow. That is, however, five stations more than in 2020.”