Prime Radio sell network to Grant Broadcasters

Prime Media has announced their exit from the radio industry, selling their Queensland radio network to Grant Broadcasters at a heavy discount from their investment levels.

The Prime Radio network consists of Hot 91 and Zinc Sunshine Coast, Zinc and 4RO in Central Queensland, 4MK and Zinc Mackay, 106.3 and Zinc Townsville, and 4CA and Zinc in Cairns.

Grant Broadcasters has acquired the stations for $24.525 million, plus surplus cash to be determined at the date of completion. The sale is expected to complete on 30 August.

The venture into radio by Prime Media has been a disaster.

After acquiring the radio assets for $77m over six years, they have impaired the book value annually, and have now sold for over $50m less than the acquisition price.

A year ago Prime CEO Ian Audsley commented on offers that had been received for the radio network over the last two years as 'insulting'. It is believed that these offers were well above what Grants have paid, however as the earnings continued to fall, so did the price.

Presumably, the Prime Media board now feel it is less insulting to exit before the business declines further.

Notwithstanding the low sale price in the context of the price Prime paid to acquire the assets, Grants are believed to have paid a reasonably full multiple for the business.

The sale multiple is believed to be around 8.0x EBITDA. Whilst full, this is based on softening Prime earnings and so is an enticing price for strong radio operators.

In FY11 Prime reported earnings of $4.8m, in FY12 they reported earnings of $4.3m, and it is believed the earnings in FY13 will be signficantly lower than that.

This is the third regional radio transaction in Queensland over the last couple of years.

  • Grant Broadcasters acquired Hitz FM and 4BU in Bundaberg from Fairfax at what was believed to be a multiple of 7.6x EBITDA
  • EON Broadcasting acquired Sea FM and Mix FM on the Sunshine Coast from SCA in a forced sale for a multiple of 6.2x EBITDA

Grant Broadcasters now have a solid footprint in every state in Australia, in some very attractive markets. 

The acquisition places Grant Broadcasters in competition with Southern Cross Austereo in Cairns, Townsville, Mackay and CQ, and with EON Broadcasting on the Sunshine Coast. 

 

Published on Monday, 12 August 2013 11:19



ExPower(10:35am 12 Aug 2013)
Well done to the Camerons. It would be nice if they also spent some money on upgrading their existing stations too. I believe they've been using the same on-air software for nearly 20 years at some stations.

And how about a nationally branded network?
StillPower(10:48am 12 Aug 2013)
Indeed well done to The Camerons. The belief that they are using the same software for nearly 20 years is incorrect. Current stations operate with either Next Gen or Audio Vault, all versions made within the last 5 years.
Keith(10:49am 12 Aug 2013)
Well done Grant Broadcasters, Fairfax follow Prime's lead and sell.
Anonymous(11:00am 12 Aug 2013)
Lets all take a moment to be thankful it wasn't sold to Caralis.
Anonymous(13:18pm 12 Aug 2013)
At least now someone with some kind of radio knowledge is running the show, instead of running the place to the ground. Feel for the amazing staff there who are about to have their world turned upside down again! lets hope its for the best.
Do the Math(13:39pm 12 Aug 2013)
So Prime initially bought 2 stations for 33 million.
And now they sell 10 stations for 24 mil.
That worked well didn't it?
Brendan Atchison(14:35pm 12 Aug 2013)
Congratulations Janet Cameron and family.Sure come a long way from 2 DU days in the Seventies.
Business 101(15:21pm 12 Aug 2013)
As they say in the boardrooms filled with people who 'know' what they're doing. THAT'S how you get a small business. Buy a big one, and run it down to the ground?
Steve(15:41pm 12 Aug 2013)
Wow, current Granters must be high-fiving themselves!

The environmentalist in me however feels for the extra trees that will be slain to print pointless capex orders. Nah just kidding, love your work!

Just a reminder the light bulb in Studio A still needs replacing.
Ryan Rathbone(15:51pm 12 Aug 2013)
Well done to the Grant Broadcasters on their purchase it’s good to see an Australian family business growing.
Hopefully their live and local operation style remains viable and they can continue to help save regional radio from becoming a series of networked shows.
Jan(16:19pm 12 Aug 2013)
I just think Prime did such a terrible job that anything has to be better.

If you work at Zinc etc.... don't get your hopes up!
Dr Radio(17:52pm 12 Aug 2013)
It is pleasing to see Grant get these stations.

In many ways this company sets standards the commercial radio industry should all aspire to.
Michael(18:12pm 12 Aug 2013)
This is great news for regional radio in QLD. Grant broadcasters are excellent radio operators evident from River 94.9 in Ipswich, Chili 90.1 in Tasmania and K-Rock/Bay Fm in Geelong. These are quality stations owned by people who know how to make good radio.
Adam McGrath(19:18pm 12 Aug 2013)
Great news for family. As x power, 2ec,krock,bay fm employee lets hope is kept local and live and continues to grow
Richard S. Kazimer(4:59am 13 Aug 2013)
Tell me they at least kept the Red Swingline Stapler.
George(6:52am 13 Aug 2013)
Whilst its nice that many current employees like to praise the Cameron's for their new purchase the reality of their radio prowess is somewhat below par.
Simon(7:27am 13 Aug 2013)
Prime really blew this one Wow
Their loss is Grants gain
davesmith(9:41am 13 Aug 2013)
Great to see Prime Radio is once again owned by a strong and dedicated radio company that is passionate about the medium.
Prime Radio with it's mix of AM Talk, AM Music with FM music formats is always fighting above it's weight up against stronger dual FM SCA stations. The main fact is that Prime has many talented ,hard working and dedicated people within it's ranks ,And I believe that they can only benefit from joining the Grant Broadcasters Team.
Anonymous(17:46pm 26 Jan 2014)
If only they bought out the Capital Radio Network, then they'll be 100% National and when DAB coming to Hobart?

 Post Anonymously 

   I am a real live breathing human person

The Capital Radio Network have a vacancy for a Producer in Canberra. Details.

 
 
 

Northern Territory Broadcasters has a vacancy for a Program and Content Director. Details.

 

 

105.1 Life FM Bendigo has a vacancy for a General Manager. Details.

 
 

Macquarie Radio Network has a vacancy for a Broadcast Technician based in Brisbane. Details.

 

 

 

 

 

 

7HO has a vacancy for a Promotions Manager. Details

 

Nova Entertainment are looking for a Creative Writer based in Melbourne. Details.

 

 

7XS has a vacancy for a Breakfast Announcer.  Details.

 

Grant Broadcasters are looking for a Creative Writer / On Air Personality based in Port Pirie.Details.

.

Nova 93.7 has a vacancy for a Creative Writer. Details.

 

ABC Local Radio are looking for 2 Local Content Managers, one in Sydney and one in Melbourne. Details.

 

Mix 106.3 are looking for a Breakfast Producer. Details.

 

 

4BC in Brisbane has a vacancy for a News Journalist. Details.

 
 
 
 

Geelong Broadcasters has a vacancy for a Journalist/Newsreader on a 12 month contract. Details.

 

 

Macquarie Radio Network has a vacancy for a Promotions Assistant based in Brisbane. Details.

 

 

 

 

 
 

Grant Broadcasters has a vacancy for a Broadcast Engineer based in Cairns. Details.

 

 

 

 

 

 

 

 

 
 
 

ARN has a vacancy for a Senior Producer with Hughesy and Kate. Details.

 

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