Business News Deals Media

Stations to change hands as Entercom and CBS create second biggest American radio firm

By | Published on Thursday 2 November 2017

CBS Radio

American radio firm Entercom has agreed to divest thirteen of its stations in a bid to get approval from the US Department Of Justice for its merger with CBS Radio.

As previously reported, it was announced in February that US media business CBS would spin off its radio division into a standalone company and then merge that with Entercom to create the second biggest radio business in America.

That deal needs approval from both competition and media regulators Stateside. The DoJ has agreed to OK the deal providing Entercom sells off stations in Philadelphia, Boston, San Francisco and Sacramento. Competition regulators said that, without those sales, the combined Entercom/CBS would be too dominant in those cities, skewing the respective local advertising markets.

Makan Delrahim, Assistant Attorney General in the DoJ’s antitrust division, said: “The required divestitures will protect competition for local businesses that advertise on radio stations in [these cities]. The elimination of this competition would have resulted in higher prices to businesses in those markets”.

Entercom will sell the stations it is required to divest to rivals iHeartMedia and the Beasley Broadcast Group. Though, as part of its deal with iHeart, it will also acquire some stations.

The merger still requires approval from media regulator FCC, but that is expected imminently. Confirming the deal with the DoJ, Entercom CEO David Field told reporters: “Today’s announcements mark a significant milestone as we work to complete the transformational combination of Entercom and CBS Radio. While it is necessary to divest certain stations in order to secure regulatory approval, it is difficult to part ways with so many strong brands and, most importantly, their talented people”.