Regent Reborn

So, if we are to believe the announcement yesterday, Regent CEO Bill Stakelin and CFO Tony Vasconcellos have been shown the door.

Don't get me wrong -- it was all nicey nice. "They have chosen this moment to move on" is what the new owners said.

Regent emerged from bankruptcy with a group of investment capitalists running the show. After all, they traded debt for equity and became the owners -- a familiar scenario in radio these days.

Steven Price (industry veteran Bob Price's son) is the new CEO and chairman.

Stuart Rosenstein the new CFO.

Thus, Oaktree Capital has installed its own management with the supposedly reassuring thought that both Price and Rosenstein "intend to make a significant equity investment".

Both are being touted as seasoned industry executives.

In addition to being Bob's Price's son, Steven had been a managing director at Centerbridge Partners and Spectrum Equity Investors. Price even worked at the Pentagon as Deputy Assistant Secretary of Defense.

Sounds like good background to run a local radio group, right?

Price and his new CFO Stuart Rosenstein worked together at PriCellular. Rosenstein, the owner and managing principal at AMG Financial.

Maybe you can see where this is heading.

Then there is the matter of the name change from Regent which means administrator to Townsquare Media, too cute by a mile for me.

In a letter to vendors yesterday, the newly-crowned prince -- I mean, Price said, "the name change is consistent with the vision brought by new management and the Company's controlling shareholders to build the country's preeminent local media company, operating across multiple platforms and focused on mid-sized markets".

Wasn't Regent supposed to be a local company before the name change? Did I miss something?

Maybe this is just hitting me on the day that I discovered I will probably be paying more to fly from Phoenix to Newark soon as a result of the United/Continental merger.

Look at what Price is saying.

Multiple platforms -- boy, if he means it he'd better get hiring because his investor buddies are clueless on that one.

New management the way Price is talking about could be translated into meaning a new broom sweeps clean, yet how easily we forget.

Little, tiny matters such as the fact that Stakelin and Vasconcellos somehow got the board to extend their contracts and give them a raise while they were upside down. The two guys who would have to share some responsibility in the demise of Regent, wouldn't you think?

Yet Oaktree must have swallowed its tongue. It looks like the fix was on since the nicest thing that Oaktree could say about Stakelin and Vasconcellos in their press release was "their leadership over the last year in connection with the Company's restructuring has been exemplary".

In other words, mission accomplished -- Stakelin and Vasconcellos got their money -- thanks for your service to the Company (note how they actually capitalized the "C" when they mention the company like we do when write the word "God"? Must be some new local radio thing to endear yourself to the local community.)

And in case you forgot, let me refresh your memory.

December 31, 2009 – Regent doesn’t make its loan payments. Period.

December 31, 2009 – The Regent board finds it fit to rehire their two top guns. Period.

Money cures everything.

Stakelin and Vasconcellos will show up somewhere else in this business -- richer for their efforts at Regent.

Price and Rosenstein get to play with a 62-station company in 13 markets.

Welcome to the future of radio.

Every once in a while someone will write to me and say, "My God, this is such a depressing picture of the future of radio" to which I reply, "It's not the way real operators would run local radio stations".

A CEO with financial and Pentagon experience.

Wow! That's impressive.

I guess that's better than being a dj who worked his way up to music director, then PD then maybe general manager -- you know, simple things like knowing how an actual radio station really runs.

Even some of the CEOs who have participated in the hit CBS TV show "Undercover Boss" have commented on how little they actually knew about running their companies. That the reality show was a wakeup call for some of them.

Citadel may very well be like Regent when their pre-packaged bankruptcy finally wins approval whether or not Fagreed Suleman stays on. (And don't worry, Fagreed's got a contract extension pre-packaged for himself just in case).

The moral of the story seems to be it's not nice to miss debt payments and when you do the big bad wolf comes after you and blows the door down.

What is scary is that the big bad wolf is also staying to operate the local stations.

It doesn't matter what the name of the company is -- Townsquare or the more appropriate Times Square.

So let me offer some unwanted advice to the new owners and operators of Regent:

1. Hire back the talented people you fired, you'll need them.

2. Steven, step down as CEO after the second day on the job and hire a radio person who has earned the right to be making operational decisions by virtue of the fact that they learned radio from the ground up. Remember, it's your money on the line. Do you really want to risk it by having you run the company?

3. Get some live, local morning shows on-the-air. Hint: morning shows well done can bring in 50% of your stations revenues.

4. Don't dare try to think about multiple platforms when the platform you are taking over is suited for a hanging. Learn about new media and the next generation, about sociology as it pertains to technology -- not financing or taking over a new media company, but running one.

5. Make up to your vendors the raw deal they got from Regent on the way to bankruptcy.

6. Sell some of your stations to local operators -- that's the best way for you to maximize your profits. If you run these stations, even a wild recovery won't last long enough to cover up mistakes Wall Street bankers are likely to make playing radio station manager.

It's a dirty deal for listeners, too.

Over the years -- in the name of financial prudence -- they have lost their favorite air personalities and live, local formats.

Raw deal for advertisers who are getting less for their investment than ever.

But there is good news.


If you operate in a market with some of these newborn pre-packaged bankruptcy babies, go get them. They know not what they do.
  1. Cut off your voice tracking.
  2. Put live, local personalities and programming on-the-air.
  3. Hire the many local talented salespeople who can help you triple your billing.
  4. Start a separate division to provide new content for fast-growing mobile media devices.
The end game for investment banks is to take care of good old number one -- and that wouldn't be listeners or employees.

I'd like Townsquare to prove me wrong.

I've listed four standards by which they can be judged.

Mark my words, investment bankers running hands on radio stations will make you wish you had your original incompetent radio CEOs back again.

You know, the ones who are actually good broadcasters who sold out for quick bucks and contract extensions and owe their souls to the company store.

As Tennessee Ernie Ford sang in "Sixteen Tons":

You load sixteen tons, what do you get
Another day older and deeper in debt

Saint Peter don't you call me 'cause I can't go

I owe my soul to the company store

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