But which cluster(s) does it sell? And with two months remaining before a $150-million covenant is due, selling to a cash-rich group like Bonneville in, say, Washington, D.C. is a better deal because of the asset value of the properties (not the Citadel stock) than poking around with what may be four or five smaller clusters and, potentially, different owners of each.
A D.C. sale, alone, could bring $200-million plus and include some "goodwill" pricing, rather than an economy depressed small cluster like Presque Isle or several in Pennsylvania.
I would think they'd not like to sell a heritage, marquee type station (WMAL or a WLS, a KABC, etc) to keep it in the family, so to speak, but buyers are looking for nearly sure bets in this economy, and a smaller cluster such as in Maine may not be, for now, the cup of tea to jump on. A group cluster in, say, Providence, R.I. -- maybe. The stations there are so well known and have deeply successful track records in sales, facilities and market heritage.
I still believe a pre-packaged Chapter 11 bankruptcy to "buy more time" - while Citadel decides on what to do in selling certain assets, while giving a debt-for-equity control to the bankers is in the works. A straight bankruptcy will hurt any return on debt the banks already have and they don't want that. The value of the stock is minimal and a lot of people have been hurt by Citadel's doings.
All that's left is cash-flowing radio stations with heritage, goodwill and asset value and the need to continue to dance (as Clear Channel has been doing for two years) to avoid creditors (including those nasty interest payments to investment banks,) or declare a full-on Chapter 11 and keep everyone at bay, which means major write-downs to the lenders -- which they don't want.
Citadel wants to get the most out of what it can, obviously, as does the investment banks -- and it's easier to match a group with a history of working well in an economy such as this, than on speculative owners who may not in a cluster like Presque Isle, do any better than what Citadel did. There is no magic wand.
The key will be to satisfy the debt, which is mandatory, while keeping the flow of money not available from Citadel to a minimum for now -- with the same people running the company because banks don't run radio stations (nor want to,) and yet, provide an out for the investment banks, as well. The stockholders have already taken a bath. The banks can't afford to do so.
The way to do so -- Citadel holds off the creditors and those interest payments (unless they redo the loans first,) while the banks hold control and can flip the switch to selling properties at any time to recoup the $150-million. There's no where near that in the Main properties. It will have to be an attractive part of Citadel to attract that attention.
I'd not be surprised to see a merger for the ABC Radio Networks and its syndication arm(s) first. Pricey, but the one division that has bankrupted Citadel since the beginning.
The stations, as a whole (more than in part,) hold considerable asset value and are worth more than fire sale prices. Same thing happened with Clear Channel where some clusters went for more money in this economy than what they were purchased for -- all the while still losing money. It just depends on who's got the deepest pockets.