Indianapolis….This morning a Hungarian court ruled in favor of Emmis Communications Corporation (Nasdaq: EMMS)-owned Sláger Radio that the National Radio and Television Board (ORTT) illegally awarded a national radio broadcast contract to FM 1. The ruling means that Sláger was one of only two qualifying bids in the recent tender for Hungary’s two national radio licenses.
“We feel vindicated that the courts struck down the regulatory decision, and ruled in favor for our claims,” Emmis Chairman & CEO Jeff Smulyan said. “The people of Hungary believed in Sláger, and we trust we’ll be back on the air soon.”
The court orally ruled today that any bidder for a national radio license that has an interest in another Hungarian radio station has a conflict of interest under Hungary’s Media Law and may not be awarded a national radio broadcast contract. The court made the same ruling earlier this month in a case involving Danubius, the former operator of the other national Hungarian radio station. Because all the other bidders in the recent national radio broadcast license tender had interests in other Hungarian radio stations, Slager and Danubius are the only two qualified bidders.
Emmis won the broadcasting license in 1997. During its 12-year stewardship, Emmis and Sláger invested almost 30 billion forints ($170 million at current exchange rates) in Hungary’s economy, provided employment to its all-Hungarian staff, brought world-best practices to the local industry, and operated in a completely transparent and politically non-partisan manner.
The Hungarian public responded quickly to the station: Sláger was consistently the top-rated station in Hungary, reaching 3.5 million listeners per week (out of a population of 10 million).
There has been enormous international pressure on the Hungarian Government to reverse the regulatory decision, including the U.S. Congress resolution condemning the ORTT’s actions (passed 333-74). A Special Prosecutor has been appointed in Hungary to investigate criminal wrongdoing. The Prime Minster of Hungary, the President of Hungary, and the head of the Hungarian National Radio and Television Board all denounced the license process as politically corrupt and contrary to the interests of the Hungarian people.
Today’s ruling was verbal; the written ruling is expected within the next week.