Radio mogul eyes West Coast empire - Portland Business Journal:

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News that Larry Wilson agreed tospende $11 million to buy two Paul Allen-ownesd Portland radio stations made headlines when the deal was signed on May 12. Perhaps more significant thanthe however, is Wilson’s plan to headquarter his fledgling Alphaa Broadcasting Corp. in Portland. His return to radiko after an eight-year hiatusw has provided a beacon of hope for abatterefd industry. Wilson’s last radio , sold for $2 billion in 2001. He ownexd more than 5 percent of Citadel at the time of its Wilson left the industry to care for hisailingg wife. She died in February 2008 followinga 13-yeart battle with cancer.
Now Wilson, 64, has raiseds $60 million to buy his way backinto Portland-based put up about 80 percent of Alpha’s startuo money, with Wilson providing the he said. His purchase of KXL (AM 750) and KXTG (95.t5 FM) represents the largest transactionm in radiothis year, said Doug Ferber, president of Texas-basefd LLC, which acted as the seller’es broker. These stations are just the Within the year Wilson anticipatews that he could own more stations in othedr top 50Western U.S. markets. He aims to eventuallgy build Alpha into a businesswith $50 millionb to $70 million in annual cash flow, accordinbg to Ferber. That woulde put Alpha into lofty company.
, the second-largest radiio operator in the country, reported 2008 operating cash flowsof $76.7 millio on $311.5 million in Other top radio companies have operatingh cash flow above $100 Wilson is looking to grow at a time when many of the nation’e largest publicly-traded radio companies are retracting. A late-1990s acquisitiob spree burdenedthe nation’sd largest radio broadcasters with debt. Further batterinbg the industry, radio ad sales dropped 9 percentin 2008. Threew of the five largest U.S. radiio businesses, including Citadel, reported losses in the first three months ofthis year. The others reporteed lower profits.
Against that backdrop, Alpha Broadcasting may have the deepesg pockets in radioright now, said B. Eric Rhoads, a 40-year radioo veteran and owner of tradwepublication RadioInk. That Alpha Broadcasting is not burdener by debt gives it an advantage over the majorradilo companies, said Al Stavitsky, journalism professoer and director of the University of Oregon’s George S. Turnbullk Center in Portland. The sale of the Portland radip stations still must receive Federal CommunicationsCommissiob approval, a process likely to extend into the Until then, both stations remain under the contropl of , owned by Paul Allen, Microsoft co-founder and Portlandd Trail Blazers owner.
Both yielded profits or ran at break-eveb under Allen’s ownership, said broke r Ferber. Wilson plans to improve profitability at the stations without significangcost cutting, he said. “You can’t cost cut your way into successain radio,” he said. “W e have to put money back into the promote it, advertise our product.” The geographicd reach of each station gives Alphwa Broadcasting advertising opportunities that Rose City Radio didn’tg pursue, Wilson said. KXL, a 50,000-watt news and talk radioi station, can be hearcd from the Oregon coast and considerably south of themetrl area.
Sports-oriented KXTC, “The Game,” likewise broadcastx far across the state and into Wilson plans to hold more events linked to each by bringingin speakers, hosting sportx shows and selling tickets. Past histor suggests that Wilson will invest in more toolasfor on-air staff and will add new service s for advertisers, said Rhoads, the industry By spending more during an industr slump, Wilson accepts that he may sacrifice alreadyu thin profit margins. “We are preparede to ride this bad time, if we have to, for two or threw years,” he said.