In advance of the anticipated bankruptcy of Citadel on or before January 15th, Fagreed started to blow up what’s left of his company after years of mismanagement on his part.
And, this is only the beginning – sad to say.
Here it is -- unfiltered -- keeping in mind that I read a trade press story yesterday playing up the “hiring marquee talent” instead of all of Fagreed's firings. While I can appreciate good spin on occasion, it’s the holidays, talented people are getting fired, stations are being gutted and lies are being told.
1. Citadel started massive layoffs in Dallas and elsewhere yesterday. Talent, program directors and more will likely follow. PDs Richard Lee and Peter Stewart are out. Watch how many more Citadel tries to slip under the radar because under their repeater radio scenario no PDs will be needed on the local level. Just “traffic cops” as I was saying yesterday to direct repeater programming onto local stations. (Someone please, contact FCC Commissioner Michael Copps who is aiming to tighten what it takes to hold an FCC license. So much for getting the FCC off our backs if it results in this mess called consolidated radio).
2. Live and local morning shows will be a thing of the past on most Citadel stations. In their place, Repeater Radio – syndicated non-local, less expensive options.
3. Citadel will be adopting what it calls a new approach to on-air talent. They call it “Marquee Talent” from Citadel-owned major market stations voice tracking shifts in other markets. I call it “Cheapee Talent” -- not local and amortized by the more stations that carry it. You can decide if they are marquee talent when you see their ratings – in local markets!
4. KSCS, Dallas jock Jeremy Robinson to do non-local Repeater Radio in the evenings. KSCS will run the Citadel Media national show. Race Taylor WPLJ, New York to do PM drive nationally in addition to his local shift. A few examples of radio on the cheap. More work for less money. More national and less local. More desperation from the folks who brought you Citadel bankruptcy – the mini series.
5. Now you know why Citadel Media President John Rosso took over for Jim Robinson. Citadel Media will be the cost-cutting programming arm of Citadel so they can crank out national programming so Citadel can cut more live and local programming.
6. Mike McVay gets an expanded role as consultant to programming targeted at key advertiser demos. I like Mike and he’s really a good and talented guy, but this makes no sense. Citadel is targeting nothing but bankruptcy and running on empty. What’s there for Mike to consult? A repeater format?
7. “Timeless” soft rock format will be discontinued in February. They say it’s less attractive to advertisers and affiliates are bailing. I say, Citadel doesn’t need “Timeless” as a Repeater Feeder to its other stations so it’s outta here.
So, what we see unfolding is that Citadel has begun its long farewell.
Fagreed keeps his job and benefits, but he wastes more talented people to cut what will not even amount to 1% of his deficit – thus the term “nuclear option”. Even with the cutbacks the savings are statistical aberration even!
Citadel is hell bent to get into shape – that is, bankruptcy fit. Ready for the prepackaged bankruptcy that is most likely going to be announced by Christmas or shortly after. They are not looking to develop programming or target new advertisers.
There is a recession, and advertisers are spending on new media and cutting back on everything else.
No, it’s about self-preservation.
Fagreed is negotiating with lenders that Citadel owes $150 million on January 15th and wants to come away with continued gainful employment.
I’ve called just about every shot with this guy and with this company and each day we see more evidence that Citadel is not and does not intend to be an operator.
Citadel is planning to become a holding company for station facilities, real estate and licenses.
When the pre-packaged bankruptcy gets approved, the lenders who Citadel can’t pay are going to become the owners and caretakers of these assets.
In Shakespeare’s The Merchant of Venice, a Shylock is a moneylender who lends money to his rival, Antonio, setting the bond at a pound of Antonio’s flesh.
When the bankrupt Antonio defaults on his loan, Shylock demands the pound of flesh as revenge for Antonio having previously insulted and spat on him.
The Merchant of Venice is a comedy but what is going on at Citadel right now is no laughing matter.
Except in our modern day version, the Shylock is the investment banks and the rival is Citadel.
We already know t
hat Citadel’s lenders are after a pound of flesh. They want control of the Citadel assets including the valuable ABC properties.But now, when Citadel defaults on its loan and has to get on bended knee to negotiate and then accept a prepackaged bankruptcy that puts ownership in the hands of the Shylock, Fagreed Suleman wants to make sure that he isn’t the one who is going to offer up his flesh as payment for the mistakes made while running Citadel.
That’s why he’s offering up everyone else as a sacrificial lamb.
For Citadel it is now the final act of a tragedy in which so many talented people who know what they are doing were led by into bankruptcy by an empty suit who now must avoid the wrath of the lenders (perfectly depicted by “Shylock” Al Pacino) who are coming after him.
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