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Emmis Communications Corp. Message Board

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  • longtimefollower longtimefollower Jun 21, 2011 11:56 AM Flag

    Post deal valuation of EMMS

    Nice work, but not sure why you would use 10x EBITDA. What did Citadel go for? What are competitors selling for on the stock market. I thought 8-8.5x would be the more accurate number, not 10x.

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    • Agree on 8.5X or so.

      I show implied deal value around $158 plus value of Merlin equity.

      I believe you took a stab at $250M back in Jan - market just didn't want to pay that.

      That said - company should be valued by it's 3 remaining segments -
      US Radio - 8.5X
      Intl Radio - ?
      Publishing - ?

      The next good move would be to sell the publishing division for a tidy sum. It generates minimal EBITDA on $66M in rev.

      US radio should produce a low/mid $40's BCF. If one could get a 10X+ multiple in a cont'd liquidation that would be your home run.

      The 8% interest rate on the preferred also helps to offset some of the interest burden.

      Lastly - EMMS only owns 50.1% of the Austin stations despite consolidating 100% of the results. They show a minority interest, but one must calc an 'adjusted ebitda' to arrive at a more accurate valutation.

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