Radio One to Acquire Controlling Interest in Tom Joyner Parent Co.; Build Urban Multimedia Platform

Seventh largest radio group by revenue Radio One Inc. plans to buy a controlling interest in “Fly Jock” Tom Joyner’s media company with a combination cash and stock offer worth just over $56 million, according to the principals involved. If it closes as expected in January, the deal gives Radio One a 51% controlling percentage in Reach Media, the parent company of the Tom Joyner Morning Show, which is carried on 115 stations and the Web portal BlackAmericaWeb.com.
Radio One owns/operates 69 stations and bills itself as the largest radio group that targets African-Americans.
In announcing the deal, Radio One chief executive Al Liggins characterized the purchase as “probably one of the most significant acquisitions in Radio One’s 25-year history.”
“The combination of our nationwide distribution platform and the content machine of Tom Joyner will create a one-stop-shop for advertisers looking to reach the African-American marketplace.”
Radio One also becomes the new syndicator for the Tom Joyner Morning Show, which was originally syndicated by the ABC Radio Networks. Radio One hopes to syndicate Joyner’s show on stations it owns in major markets, in addition to the 15 stations it owns that currently air the show.
Joyner and CEO David Kantor created Reach Media about two years ago to operate and syndicate Joyner’s show and run other Joyner businesses including the Tom Joyner Sky Show, the Tom Joyner Family Reunion and other special-event related units. Reach also recently developed a Tom Joyner TV show with TV One Cable network. Radio One owns about 40% of the African-American targeted cable network with Comcast.
Radio One’s 51% interest in Reach will give Radio One a controlling interest in Reach, and the company will consolidate financial results of reach for reporting purposes. Joyner and Kantor will receive roughly half of their share of the purchase price as Radio One stock and will continue to own “significant” takes in Reach. Both Joyner and Kantor will sign a 10-year employment agreement with Reach.
Reach expects to report 2005 fiscal year revenue of about $50 million and EBITDA of about $12.5 million.