Report: Broadcast Deal Market Near Lows for 2021

RADIO ONLINE | Wednesday, February 2, 2022

SandP Market Intelligence

While broadcast station advertising revenue has rebounded from its double-digit lows in the midst of economic shutdowns in 2020 at the beginning of the COVID-19 outbreak, the deal market has still been near historical lows, reports S&P Market Intelligence. However, year-end numbers for 2021 are higher than in 2020 giving reason for some cautious optimism.

The total deal volume for 2021 amounted to $4.72 billion for TV and radio transactions. The radio deal volume stands for a mere four percent of the total. 2021's $190.2 million represent the lowest radio deal volume in the company's records, dating back 40 years to 1982. The four largest radio station deals were driven by three of America's top-ten TV station owners. In June, Sinclair Broadcast Group Inc. announced the sale of its only radio stations to Lotus Communications Corp for $18.06 million.

The other three deals all happened in December, giving rise to a slightly more optimistic outlook for 2022. In two transactions, The Walt Disney Company received a total of $24.25 million for its remaining radio stations. VCY America Inc. is going to pay $9.25 million for KESN-FM in the Dallas-Ft. Worth market and Good Karma Broadcasting will pay $15 million for Disney's AM stations in New York, Los Angeles and Chicago and for an LMA for WEPN-FM, owned by Emmis Communications.

For the third year in a row, the average cash flow multiple for radio transactions remained stable at 6.6x forward buyers BCF. In S&P's estimates, only 25 full power radio stations were sold based on their cash flow. That is, however, five stations more than in 2020.