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UT may pay $6 million for second FM station

Gary Dinges
gdinges@statesman.com

The University of Texas is poised to purchase an Austin radio station and make it a sister station for 90.5 KUT-FM, Austin's NPR affiliate.

UT System regents are scheduled to vote Wednesday on whether to buy 98.9 KXBT-FM for $6 million, according to an agenda posted late Friday afternoon.

One of the stations would run news, the agenda indicates, while the other would be music intensive.

KXBT-FM, which currently features an oldies format, is owned by Border Media, a Dallas-based company in the process of shedding its properties across the state.

The call letters for 98.9 FM would probably change to KUTX-FM, according to the agenda.

"By differentiating KUT's current mixed format of news and music services across two stations, UT Austin has determined that the acquisition would contribute to the long-term public service and sustainability of KUT in a number of ways," the agenda item states.

Spokespeople for Border Media and the UT System did not return email and telephone messages Friday.

The $6 million price tag "sounds about right," said Dave Garland, a Houston-based radio station broker who is not involved in the KXBT-FM transaction. Figures from the UT System indicate the deal works out to "$3.83 per person in the station's coverage area."

In a comparable transaction, San Antonio-based Clear Channel Media and Entertainment sold 105.9 KFMK-FM to Seattle-based CRISTA Broadcasting for $6.25 million in 2010.

If the sale to UT is approved — and Federal Communications Commission approval would also be required — Austin would follow in the footsteps of Dallas and Houston, cities where NPR affiliates have in recent years placed music and news programming on separate frequencies. Across the nation, however, such splits aren't very common, Garland said.

"It's something you don't see every day," he said. "A lot of nonprofits have all they can handle with one facility, but sometimes deals do come up."

The University of Houston, which owns 88.7 KUHF-FM, finalized its purchase of 91.7 KTRU-FM from Rice University in May 2011, changing the station's call letters to KUHA-FM. KUHF-FM now airs round-the-clock news, while KUHA-FM plays classical music.

"We'd had requests for years and years to have a 24-hour news station and a 24-hour classical station," said station manager Debra Fraser. "We joked we were schizophrenic."

With minimal advertising, Fraser said, the two stations combined have about 20 percent more listeners than KUHF-FM had on its own.

In the most recent Arbitron ratings for Austin, KUT-FM ranks sixth, while KXBT-FM comes in at No. 14.

The regents' agenda doesn't explicitly indicate which types of music would air on KUT-FM's sister station, but plans call for it to be closely linked to the Cactus Café, a live music venue in UT's student union.

The KUT-FM lineup includes numerous music programs, including host John Aielli's long-running "Eklektikos" program. On its subchannels, the station features jazz music.

News programs currently heard on KUT-FM include a mix of local reports and NPR broadcasts.

The station also airs a news/talk format on another of its subchannels.

UT's interest in KXBT-FM comes just weeks before KUT-FM is set to move into new $9.8 million, 20,000-square-foot studios.

Funds from the new station could be used to help operate the facility, the agenda indicates: "UT Austin is optimistic that, over time, revenue from the strengthened services will help KUT build reserves to maintain new studios in the Belo Center for New Media to provide for unforeseen contingencies, and to create opportunity capital for new initiatives."

Managers at KUT-FM have been searching for a companion station for several years, according to the agenda, and have reportedly made offers to buy other local stations. Those deals didn't work out "either because of higher bidders or other strategic reasons."

The American-Statesman first sought information on UT's attempt to buy KXBT-FM in May.

In a letter sent in June, a UT attorney declined to provide the requested documents and emails detailing the university's discussions with Border Media, citing exceptions to the state's open records laws.

The university asked the Texas attorney general's office to review its decision. A ruling hadn't been received as of late Friday.

Contact Gary Dinges at 912-5987; Twitter: @gdinges