The radio landscape across the country will look a whole lot different when the Entercom/CBS merger closes in mid-November. On Wednesday, Entercom announced a series of deals to satisfy a civil antitrust lawsuit filed by The Department of Justice and move the CBS merger ball closer to crossing the goal line.
Here are the three deals announced Wednesday:
1) A settlement with the Antitrust Division of the U.S. Department of Justice that will allow Entercom and CBS Radio to move forward with the proposed combination.
2) Asset exchange agreements with iHeartMedia, and Beasley Broadcast in Boston, Seattle, Richmond, and Chattanooga.
3) Local Marketing Agreements with Bonneville in San Francisco and Sacramento.
Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division said the required divestitures will protect competition for local businesses that advertise on radio stations in Boston, San Francisco and Sacramento. “The elimination of this competition would have resulted in higher prices to businesses in these markets.”
The division alleged that the proposed transaction would have eliminated head-to-head competition between Entercom’s and CBS’s radio stations for the business of local and national advertisers on radio stations in the following markets: Boston, Massachusetts; San Francisco, California; and Sacramento, California.
DOJ simultaneously filed a proposed settlement that would resolve the competitive harm alleged in the lawsuit. As a result of these three deals, Entercom expects its proposed combination with CBS Radio to close as early as November 17, pending approval from the Federal Communications Commission.
Here are the details of all the deals…
iHeartMedia Asset Exchange Agreement
Under the terms of the asset exchange agreement, iHeartMedia will receive four stations in Boston and three stations in Seattle. Entercom will receive six stations in Richmond and four stations in Chattanooga. As a result of the agreement, Entercom will enter two new markets in Richmond and Chattanooga. The iHeartMedia transaction is expected to close in the first quarter of 2018. The complete list of stations in the asset exchange agreement include:
Beasley Asset Exchange Agreement
Under the terms of the asset exchange agreement, Beasley will receive one station in Boston. Entercom will receive WMJX-FM, one of Boston’s leading heritage stations, and $12 million in cash consideration. The Beasley transaction is expected to close in the first quarter of 2018. The complete list of stations in the asset exchange agreement include:
Bonneville Local Marketing Agreement
Under the terms of the LMA, Bonneville will program four stations in San Francisco and four stations in Sacramento. The LMA will become effective upon the closing of the Entercom and CBS Radio merger. The complete list of stations in the LMA include:
In connection with the settlement with the DOJ, the agreements with iHeartMedia, Beasley, and Bonneville announced today will clear the way for the Entercom and CBS Radio merger to move forward, pending FCC approval.
On February 2, 2017, Entercom announced an agreement to combine with CBS Radio in an all-stock transaction which is expected to be tax free to CBS and its shareholders. When complete, Entercom will own 235 stations.