In a letter to Emmis employees about his proposal to take Emmis private, CEO Jeff Smulyan said he’s a firm believer in the power of radio and magazines. “Unfortunately, Wall Street does not share our strongly held view of these businesses. Investors have fled the radio and magazine industries. Trading volume in our stock has dwindled, meaning investors who want to sell are limited in their ability to do so.”
Smulyan told them taking the company private offers two primary benefits. “First, we eliminate the substantial costs associated with being a public company. These costs are not only monetary. They also include the burdensome compliance and reporting costs all public companies face. Second, we can focus on long-term value creation and be less concerned with quarterly peer comparisons.”
He then went into the need to sell assets such as WLIB-AM and the radio stations in Indiana. He said he would only do that if it was absolutely necessary. “Nothing pains me more than making decisions like this. Many employees at these properties have been with Emmis for more than 20 years and have been tremendous contributors to our culture, our spirit of innovation and our hallmark of quality. I cannot thank them enough for all they have done to make Emmis what it is today. If sales are negotiated, we will provide stay bonuses for our people. In keeping with our culture, if sales are consummated and not all of our people are retained, we will provide generous severance packages.”
Jeff Smulyan is also the former owner of the Seattle Mariners, who still have not been to the World Series.
Often I tell newbies about how radio used to be a “mom and pop” industry. Owners were colorful characters who loved the idea of show biz and creative ways to draw large audience base befoe they worried as much about profits. And certainly liked breaking rules.
We should ALL be thankful that there is still “a” Jeff Smulyan still speaking the language of radio. I hope this is part of the apparent continuation of “SMALLER is more.”
Excellent Idea! All for it.
Seems to me that any “innovations” – a commodity that is sorely missing in corporate radio – might only come about from a stand-alone and private organization with credible leadership.
I must assume that Emmis does, indeed, have a strong and viable “culture”.
For those reasons, I hope this is a successful venture.