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Emmis Sales Top Expectations

In a move that should cheer the station market, prices on the properties being liquidated by Emmis Broadcasting are coming in higher than analysts expected.

The $681 million sale price for nine Emmis stations totals around 14 times trailing cash flow (the previous 12 months), higher than the 11-12 times Wall Street had expected.

Given the full valuation on these smaller stations, we expect even more upside on the forthcoming announcement for Emmis’ top stations in Orlando, Portland and New Orleans," says Merrill Lynch broadcasting analyst Larranie Mancini. Emmis has a total of 16 stations and has them all on the block.

Not surprisingly, Emmis CEO Jeff Smulyan told B&C he was pleased with the prices, adding that investors shouldn’t read anything into the structure of the current deals, which involved only small-market stations in places like Mobile.

"There was interest in everything; it’s a function of timing, lawyers and other factors," he said. He expects to reach deals for the remaining stations over the next few months.