The real loser in this deal may be Radio One, who may have just seen their opportunity to own a station or two in New York City, just go by the wayside
(Radio-Info) Inner City Broadcasting’s debt will be changing hands, says TheDeal.com, so Goldman Sachs can finally take it off the books. Inner City’s controlling Sutton family played hardball during the 2009 financial crisis, when Goldman and GE Capital were squeezing ICBC over $230 million in debt. Politicians (reportedly included President Obama) got involved, and Goldman and GE backed off. (The Sutton family would consist of ICBC chairman Pierre “Pepe” Sutton. He is the son of the founder; the late Percy Sutton, a former Manhattan borough President, Harlem businessman, activist, and lawyer for Malcolm X.)
Now Goldman finds a solution to holding the delinquent debt – it sells it to Magic Johnson Enterprises and Ron Burkle’s Yucaipa Companies. Earlier this year, MJE and Yucaipa bought a big chunk of Vibe Holdings (Vibe magazine, the Soul Train TV show), and then in April committed $16 million to buy three Phoenix-area FMs.
Now here’s the Inner City deal that includes New York-market urban AC WBLS (107.5) and gospel WLIB (1190), plus properties in other markets. Note that holding a company’s debt doesn’t equate to ownership or control, in the eyes of the FCC.
This is probably frustrating to Cathy Hughes and Alfred Liggins at Radio One. They’ve talked for years about combining what’s already the largest African-American radio group with Inner City.
