Banks to Take Over Media Industry?
Throw companies like Tribune into the mix where JP Morgan will allegedly end up with an majority equity stake, and one wonders why Goldman and JPM were so eager to provide “rescue” financings to virtually the entire distressed media space: both companies knew too well that sooner or later they would end up with full equity control over essentially the most coveted industry: thousands of TV stations, radio channels, newspaper and magazines. If you thought the media propaganda was unbearable now, just wait. Nonetheless, one doubts that much will be made by the FCC of JP Morgan’s or Goldman Sachs’ stealthily encroaching control of the entire media world. After all, they already pretty much already control the airwaves. This way their domination of the 4th estate and the idiot tube will soon be complete.
Tyler over at Zero Hedge sends me this freaky story about the recess of a boatload of media companies into the ownership arms of certain investment banks, including Goldman and JP Morgan Chase.
Zero Hedge outlines the basic scenario: distressed media companies, including large conglomerates like Citadel Broadcasting (one of the largest radio networks), are defaulting and falling into the hands of their lenders. And while some have as primary lenders hedge funds, the problem there is that hedge funds often operate through accounts located in foreign tax-shelter countries like the Isle of Man, which makes them problematic as owners of American media companies. Since FCC rules prohibit foreign firms from owning large stakes in media firms, the advantage in what is essentially a giant foreclosure process will go to the big banks operating on-shore, like Goldman and Morgan.
Zero Hedge promises to spend a lot of this week outlining the restructured media landscape, which should be scary.