American Radio Systems Corp. will become the nation’s second-largest radio broadcaster following its announcement Monday that it has agreed to buy EZ Communications Inc. for $655 million in cash, stock and debt.
The Boston-based broadcasting company has been on a buying binge, increasing its ownership from 21 stations at the beginning of the year to 96 stations, most of them in midsize markets. EZ Communications, of Fairfax, Va., operates 20 stations in such cities as Philadelphia, Seattle and St. Louis.
The combined company’s estimated sales of $340 million would be second only to Westinghouse Electric Corp., which signed the nation’s biggest radio purchase in June, when it bought Infinity Broadcasting Corp. for $4.9 billion in cash and debt.
Radio station groups have been consolidating since Congress approved the 1996 Telecommunications Act, which removed the limits on the number of stations a company can own.
American’s stock fell $3, closing at $36.50, on the Nasdaq Stock Market. But EZ stock soared $9.62, to $42.12, also on Nasdaq.
