Bonneville International Corp. continued its radio expansion in the nation's top 10 markets by announcing its intent last week to purchase two more FM stations in Chicago and another FM station in San Francisco.
The $205 million transaction, yet to be approved by the Federal Communications Commission, increases Bonneville's total media properties from 15 to 18 - one TV station, 13 FM radio stations and four AM stations."This purchase is among Bonneville's most significant to date," said Bruce T. Reese, president and CEO of Bonneville. "Our continued efforts to build holdings in the top 10 markets took a major leap . . . with the addition of three stations in two prominent cities. We're excited about this transaction and look forward to serving our new listeners in the Chicago and San Francisco markets."
Bonneville is purchasing WLUP-FM ("The Loop") for $80 million; WPNT-FM ("The Point") in Chicago for $75 million and KDFC-FM in San Francisco for $50 - all from Evergreen Media. Bonneville already owns WTMX-FM in Chicago and KOIT-FM and KOIT-AM in San Francisco (plus has a deal in the works to buy KPIX-FM in San Francisco, too).
Evergreen Media is headquartered in Dallas and owns 30 stations in 12 markets, with an agreement to acquire eight future stations. It is also merging with Chancellor Broadcasting to form Chancellor Media Corp.
Bonneville's latest acquisitions means it has 15 of its 18 stations in the nation's top largest broadcasting markets.
Reece said the latest transactions will take months to complete and it will be autumn or later before it actually has control of the three new stations.
He said the transactions are part of Bonneville's continuing efforts to consolidate its operations and accent the top 10 markets. Bonneville is only absent in Philadelphia, Detroit and Boston as far as top 10 markets go.
Reece said while Salt Lake City only has $50 million available annually in advertising revenue for radio stations, New York and Los Angeles have some $500 million each available for ad revenue.
"There are more advertising dollars to go around and yet the same number of (radio) stations," Reese said.
Bonneville is also looking to sell KIDR-AM in Phoenix. It previously sold that station's AM counterpart.
Once KIDR in gone, only KSL radio and TV will remain as non-top 10 market properties for Bonneville. However, Reece said, that's OK.
"We love it here," he said in reference to Bonneville being headquartered in Salt Lake City. "I don't think we'll be leaving."
He said KSL radio TV are both currently doing well financially. In fact, KSL is likely to receive a ratings boost in both radio and TV thanks to the I-15 reconstruction. The KSL "TrafficLink" camera system and its extensive traffic reporting operation are currently unrivaled in the market.
Regarding Bonneville's policies on advertisements, Reese said that LDS Church leaders do not dictate the day-to-day operations of the company.
He said it's a Bonneville decision not to air any gambling or lottery advertisements on any its stations. However, beer and advertising ad decisions are up to the individual market managers. For example, he said in S.L., the decision is not to air wine or beer ads.
Reese agrees it makes it a little more difficult financially to be selective in the advertising accepted, but it is not an insurmountable problem.
While Bonneville International doesn't rank among the nation's top 50 broadcasting companies in total stations owned, it is 11th nationally in total advertising revenue - another sign it is healthy despite selective ad policies.
He said KDFC-FM in San Francisco will retain its classical commercial format once Bonneville takes control. However, he said all three Bonneville stations in Chicago are adult contemporary format.
"They're on top of each other," Reese said. "We'll have to tweak the formats."
Most of Bonneville's radio stations have adult contemporary formats and seek a 25-54 age group.
Bonneville purchased KPIX-FM in San Francisco last month for $39.6 million.
In January of this year, it announced a deal with Entertainment Communications to obtain KLDE-FM in Houston and $5 million in exchange for Bonneville's three Seattle radio stations and also its four stations in Kansas City.
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Additional Information
Bonneville expansion
Bonneville international acquisitions: 1. San Francisco: KOIT-FM, KOIT-AM, KDFC-FM and KPIX-FM
2. Los Angeles: KBIG-FM
3. Phoenix: KIDR-AM
4. Salt Lake City: KSL-TV and KSL-AM
5. Dallas/Forth Worth: KZPS-FM and KDGE-FM
6. Houston: KLDE-FM
7. Chicago: WLUP-FM, WPNT-FM and WTMX-FM
8. Washington, D.C.: WWVZ-FM, WWZZ-FM and WXTR-AM
9. New York City: WDBZ-FM