Cox Radio Extends its Benefits: Could it Go Private?

On Friday, Cox Radio's (CXR) Board approved an amendment to allow all employees to participate in its defined benefit pension, post-retirement health and life insurance plans. Previously, only those employed before 12/31/96 could participate. Now there will be approximately 2,000 eligible employees to participate vs. 117 currently. XR stated that the Board amended the plans so that benefits for newer employees are in-line with those of longer-term employees. This could also fuel our April 2006 "Tinderbox" (going private) theory for CXR. Here's why: 1) Most companies have moved away from defined benefit plans and towards defined contribution plans; none of CXR's public radio peers have these benefits, this new plan will be similar to other Cox Enterprise division's plans 2) Improving benefits could be a move to retain talent if CXR goes private and other forms of compensation are not available (stock options), and 3) Cox Enterprises took Cox Communications private when the cable industry had fallen out of favor and before a recovery in values.