KRTH-FM to Be Sold to Rival for $110 Million : Media: Record-setting deal with KROQ spotlights a growing trend of consolidation among nation’s biggest radio stations.

In a deal that represents the highest price ever paid for a radio station, the owners of radio station KROQ-FM have agreed to buy rival KRTH-FM from Beasley Broadcast Group for $110 million in cash, the companies said Wednesday.

The deal is significant not only for the record price but also because it spotlights a growing trend, spurred by government deregulation, of increased consolidation among the country’s biggest radio stations into the hands of a few major group owners.

The buyer, New York-based Infinity Broadcasting, is the largest radio station group in the country, operating 21 stations in 13 cities. The deal exceeds the previous records set in 1991 when Infinity bought WFAN-AM in New York for $70 million and Viacom bought KXEZ-FM in Los Angeles in 1990 for $85 million.

Last year, the Federal Communications Commission, in an effort to inject new life into the moribund radio industry, lifted the so-called “duopoly rule” that prohibited broadcasters from owning more than one radio station per market, excluding those stations that were co-owned before the rules were adopted.

In the months since the new rules went into effect, there has been a flurry of deals around the country, including the recent purchase by Viacom of KQLZ-FM in Los Angeles from Westwood One for $40 million to $45 million. The new rules allow broadcasters to own two AM and two FM stations in the same market.

KRTH-FM, promoted as “K-Earth 101,” was one of the first FM stations in the country when it went on the air in 1941, but it did not become a Southern California powerhouse until two decades ago when it adopted its successful “golden oldies” format.

The radio station is now one of the Top 15 billing outlets in the country, with revenue of $25 million to $30 million and cash flow of $10 million annually.

“This indicates the radio industry is back from an industry depression,” said George Beasley, president of Beasley Broadcast Group. “From 1990 to ‘91, we experienced some pretty bad times. All the money you could borrow from the banks dried up. Now they are loaning again, and that’s a good indication the business is coming back, particularly in the Top 10 markets.”

Beasley bought KRTH-FM, along with sister station KRTH-AM, in 1989 from RKO General for a then-record-setting combined purchase price of $86.6 million. The value of the FM station at the time was about $63.5 million. Beasley subsequently sold the AM outlet, whose call letters are now KKHJ-AM, in 1990 for $23 million.

Analysts said KRTH-FM will give Infinity added clout with advertisers because the two stations will be able to command a broader slice of the audience. KROQ-FM appeals to mostly younger listeners, while KRTH-FM’s primary audience is 25 to 54 years old.