| Big City Radio, Inc. | |||
| Ticker: | YFM | 11 Skyline Drive | |
| Exchange: | American Stock Exchange | Hawthorne, NY 10532 | |
| Industry: | Service (SIC Code 4832) | (914) 592-1071 | |
| # of Employees: | 108 | ||
| Type of Shares: | Class A Common Shares | Filing Date: | 9/26/97 | |
| U.S. Shares: | 4,000,000 | Offer Date: | 12/18/97 | |
| Non-U.S. Shares: | 0 | Filing Range: | $8.00 - $10.00 | |
| Primary Shares: | 4,000,000 | Offer Price: | $7.00 | |
| Secondary Shares: | 0 | Gross Spread: | $0.49 | |
| Offering Amount: | $36,000,000 | Selling: | $0.29 | |
| Expenses: | - | Reallowance: | $0.10 | |
| Shares Out After: | 13,375,520 |
| Manager | Tier | Phone |
| Donaldson, Lufkin & Jenrette Securities Corp. | Lead Manager | (212) 371-0641 |
| Issuer's Law Firm: | Paul, Weiss, Rifkind, Wharton & Garrison |
| Bank's Law Firm: | Skadden, Arps, Slate, Meagher & Flom |
| Auditor: | KPMG Peat Marwick |
| Registrar/Transfer Agent: | ChaseMellon Shareholder Services, L.L.C. |
Dollar amounts in U.S. millions except for per share data | |||||
| 6 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 12/31/96 | 6/30/97 | 6/30/96 | 6/30/97 | ||
| Revenue: | $7.94 | $4.70 | $4.21 | Assets: | $50.97 |
| Net Income: | -$3.10 | -$5.26 | $1.68 | Curr Assets: | |
| EPS: | Liabilities: | $60.03 | |||
| Prior EPS: | Curr Liabilities: | ||||
| Cash Flow/Oper: | -$7.45 | Equity: | -$9.06 | ||
| Cash Flow/Fin: | $30.85 | Cash: | |||
| Cash Flow/Inv: | -$24.23 | ||||
| Business Description |
| The company acquires radio broadcast properties in or adjacent to major metropolitan markets and utilize innovative engineering techniques and low-cost, ratings-driven operating strategies to develop these properties into successful radio stations. In order to accomplish this objective, the Company applies a variety of innovative broadcast engineering techniques to the radio broadcast properties it acquires, including Synchronized Total Market Coverage ("STMC"). STMC consists of acquiring two or more stations which broadcast on the same frequency and simulcasting their signals to achieve broad coverage of a targeted metropolitan market. In addition to STMC, the Company intends to employ other broadcast engineering techniques to enter major metropolitan markets at attractive valuations. These engineering techniques include acquiring suburban radio stations and moving the station's broadcast antenna closer to the metropolitan market ("move-ins") and acquiring high-power stations adjacent to major metropolitan markets and focusing such stations' broadcast signal into the metropolitan area. |
| Competition |
| Radio broadcasting is a highly competitive business. Within their respective markets, each of the Company's radio stations competes for audience share and advertising revenue directly with other radio stations, as well as with other media such as television, print media, billboards, compact discs and music videos. There are a number of other better-capitalized companies competing in the same geographic markets as the Company, many of which have greater financial resources. In addition, recently the radio industry has experienced significant consolidation which has resulted in several radio station groups that have a large number of radio stations throughout the United States and vastly greater financial resources and access to capital than the Company. The financial success of each of the Company's radio stations is dependent principally upon its share of the overall radio advertising revenue within its geographic market, its promotion and other expenses incurred to obtain that revenue and the economic health of the geographic market. Radio advertising revenues are, in turn, highly dependent upon audience share. Radio station operators are subject to the possibility of another station changing programming formats to compete directly for listeners and advertisers or launching an aggressive promotional campaign in support of an already existing competitive format. If a competitor, particularly one with substantial financial resources, were to attempt to compete in either of these fashions, the broadcast cash flow of the Company's affected station could decrease due to increased promotional and other expenses and/or lower advertising revenues resulting from lower ratings. There can be no assurance that any one of the Company's radio stations will be able to maintain or increase its current audience ratings and radio advertising revenue market share. The Company will also face competition from other radio stations that attempt to replicate the engineering techniques of the Company to cover a metropolitan area and from stations that simply simulcast on the same or first adjacent frequencies. While simulcasting has been employed by other broadcast radio operators in the past, the primary purpose has been to reduce programming costs for theindividual stations. The Company believes that most broadcast radio operators that have employed simulcasting have done so on different frequencies. The Company believes that few operators have successfully used simulcasting to effectively cover an entire MSA. Radio broadcasting is also subject to competition from new media technologies that are being developed or introduced, such as the delivery of audio programming by cable television systems or the introduction of DAB. DAB may deliver by satellite or terrestrial means multi-channel, multi-format digital radio services with sound quality equivalent to compact discs to nationwide and regional audiences. The Company cannot predict the effect, if any, that any such new technologies may have on the radio broadcasting industry. |
| Business Plan |
| The Company's objective is to achieve a significant presence in selected top 20 radio markets by acquiring radio broadcast properties in or adjacent to major metropolitan markets and utilizing innovative engineering techniques and low-cost, ratings-driven operating strategies to develop these properties into successful metropolitan radio stations. The following are the key elements of the Company's business strategy: (I) Enter Top-20 Markets With Low Capital Investment, (ii) Effective Coverage of Arbitron Rated Metropolitan Markets and (iii) Maximize Station Performance. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used to repay existing indebtedness under an existing credit facility. |
| Officer Name | Title | Age |
| Stuart Subotnick | Chairman of the Board | 55 |
| Michael Kakoyiannis | Chief Executive Officer, President Director | 54 |
| Bryan Subotnick | Executive Vice President--Corproate Development | 33 |
| Paul R. Thomson | Vice President and Chief Financial Officer | 41 |
| Alan D. Kirschner | Vice President--Engineering | 46 |
| Steven G. Blatter | Vice President--Programming | 31 |