# Essay on Case Study: Radio One, Inc.

2468 Words Feb 14th, 2011 10 Pages
- Part A Corporate Valuation Date: 21-09-2009 Instructor: Dr. Oliver Spalt Course: 323058

Corporate Valuation

P.W. Segers J.J.T.M. Zegers

779710 722085

1. Radio One’s opportunities and risks with respect to their acquisition policy We have identified four main benefits and five major risks with respect to the desired acquisition of 12 urban stations along with the nine stations in Charlotte, Augusta and Indianapolis. Potential benefits: 1. After the acquisition of the 12 urban stations, Radio One becomes the market leader in the African-American segment. The market leader is usually the most attractive negotiator for advertisement
To finish step 3, we calculated the terminal value for 2004 and discounted this value back to 2000. The last step is to calculate the present value in 2000 for the FFCFs between 2001 and 2004. This number is added to the terminal value as we calculated in step 3. This is the enterprise value of the 21 stations based on a discounted cash flow analysis. Hence, the enterprise value of the 21 stations together is \$1,334,037,217.

3. Radio One’s offer based on transaction and trading multiples Transaction multiples: The transaction multiples method takes into account the value paid for similar transactions in the industry and benchmarks it against certain parameters, like value/BCF ratio. Table 3.1 shows the transactions in the radio industry of similar quality stations.
Company name: Infinity Broadcasting Cox Radio Paid \$1,400,000,000 \$380,000,000 Paid / BCF 21.5 18.4 BCF \$65,116,279.07 \$20,652,173.91 Number of stations 18 7 Paid per Station \$77,777,777.78 \$54,285,714.29

Table 3.1: transactions in the radio industry of similar quality stations.

Due to the stations were of similar quality to those purchased by Infinity Broadcasting and Cox Radio, a transaction multiple of 20 (given in the case) can be used.

## Related Documents

• ###### Essay on Hei Case Analysis

Case No.1: Hightone Electronics Inc. Hightone Electronics, Inc. was founded in Palo Alto, California over 50 years ago. Originally, the company provided radio components to small repair shops. Products were offered for sale through a catalogue that was mailed to prospective customers every four months. The company built its reputation on high quality and service. As time passed, HEI began supplying more than just radio parts, adding items such as fuses, transformers, computers, and electrical…

Words: 970 - Pages: 4
• ###### Essay The Crazy Eddie, Inc. Case Study

Crazy Eddie, Inc. Case Study Case Summary The Crazy Eddie, Inc. case reveals the success story of the retailer and critical factors that resulted in dismal performance and bankruptcy. In 1969 Eddie Antar a 21 years old high school dropout started his Crazy Eddie “empire” right here in Brooklyn on Kings Highway. Despite its modest beginning, the business grew tremendously to dominate the New York electronics retail market. By 1989 Crazy Eddie Inc. had 43 outlets in four states (New York, Connecticut…

Words: 730 - Pages: 3
• ###### Essay on Biology

Study Guide and Reinforcement Student Edition ips.msscience.com Copyright © by The McGraw-Hill Companies, Inc. All rights reserved. Except as permitted under the United States Copyright Act, no part of this publication may be reproduced or distributed in any form or by any means, or stored in a database retrieval system, without prior written permission of the publisher. Send all inquiries to: Glencoe/McGraw-Hill 8787 Orion Place Columbus, OH 43240 ISBN 0-07-867338-0 Printed in the United States…

Words: 14372 - Pages: 58
• ###### A Case Study on Krispy Kreme Donuts Essay

CASE FORMAT KRISPY KREME DOUGHNUTS, INC. --- 2004 1. Title Page a. Case title b. Group Members c. Class schedule d. Term and school year e. Date submitted 2. Content a. 1-page Case Summary b. Proposed Vision and Mission Statement for KKD c. External Audit --- EFE Matrix d. Competitors Analysis --- CPM e. Financial Ratio Analyses f. Internal Audit --- IFE Matrix aveA Case Study on Krispy Kreme Doughnuts, Inc A Case Study on Krispy Kreme Doughnuts, Inc ________________________________________…

Words: 2347 - Pages: 10
• ###### Essay on Are Cell Phones to Die For?

in the United States alone (EHSO 1). However, if an individual considered their cell phone to be a cause of brain cancer, would one still be inclined to utilize it? Some researchers have implied that the use of cell phones is a potential cause of brain cancer. On the other hand, this claim has not yet been sufficiently established. Of course it is understandable why one may suppose cell phones to produce brain cancer. Cell phones are powered by microwave radiation which some may assume to be an especially…

Words: 2084 - Pages: 9
• ###### Essay Bob Galvin And Motorola, Inc.

Bob Galvin and Motorola This case study will explore the problems identified in the case study, Bob Galvin and Motorola, Inc. (A), both major (or macro) and minor (or micro). Every problem has a cause and this case study will look at the problems coupled with the cause for each. Not only the problem ans causes are affected, but also the organizational systems. This case study will look at five different areas of the organizational structure affected. First is the structural area. Second is the psychosocial…

Words: 1150 - Pages: 5

Assignments section below. You may obtain the Harvard cases and other material for this course at a 50% discount or free by following this course link: The course link is to Financial Analysis Spring 2012. You must register to gain access. You are expected to purchase the cases. To copy cases from others is a violation of copyright law and is unethical and illegal. Harvard sends faculty lists of those who have purchased its cases. Those who have violated copyright may be subject to correction…

Words: 4814 - Pages: 20
• ###### Biography Of Dahlia Mostafa A Lady With Twenty Two Awards And Grants And Academic Degrees

is an engineer, a therapist, a life coach, a marriage counselor, a writer, a social media expert, a public speaker, a teacher, and a radio show host. Honored by thirty-two awards and grants, she holds a Bachelor and Master’s degrees in Electronics and Communications Engineering at Arab Academy for Science and Technology, Egypt. Moving to Canada for her graduate studies, she finished the Doctoral degree courses and research in Electrical Engineering at McGill University. After an ample years of experience…

Words: 1131 - Pages: 5
• ###### Essay on Devry

Kesia Gipson Case Analysis 1 – Apple Computer: Research How Apple managed to Reinvent Itself Over the Years. NETW583 September 6, 2015 What do companies who succeed and thrive in today’s world have in common? What does it take for a company to thrive in an ever-changing environment? One secret weapon most companies have discovered as a top priority today is innovation. In the world we reside in today, it’s a must that innovation is an important key to an organization’s overall business strategy…

Words: 1074 - Pages: 5
• ###### Dr Pepper - 7up Essay

Running head: DR PEPPER/7UP, INC. Dr Pepper/7Up, Inc. – Case Analysis MKTG610 Case Recap Squirt soft drink is a caffeine-free, low sodium carbonated drink designed and created by Dr Pepper/7Up, Inc... This powerhouse drink is a wonderful creation of distinctive grapefruit juices, which gives it its fresh citrus taste. Due to its unique flavoring as a soft drink, Squirt is one of the best-selling carbonated drinks in the United States (Kerin & Peterson 2009) The key elements…

Words: 1919 - Pages: 8