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7/23: Atlanta’s Cumulus wants to go private
The Atlanta Journal-Constitution
Atlanta-based radio conglomerate Cumulus Media, which owns Q100 and 99X, is seeking to take the company private at a value of $1.3 billion. That’s equivalent to $11.75 per share, 40 percent higher than the Cumulus closing price Friday.
Businesses in general are on a private equity binge and with radio out of favor with investors, going private is a temptation. Clear Channel, the nation’s largest radio company, is also seeking to go private. Lew Dickey and the family, according to my colleage Scott Leith’s story is working with Merrill Lynch Global Private Equity. Cumulus owns or operates about 344 stations nationwide, mostly in smaller markets, generating $334 million last year on a net loss of $44.6 million (which included an impairment charge of $63.4 million to reduce the carrying value of certain broadcast licenses and goodwill.)
Generally, this means down the road, we’ll know less about the financials of Cumulus stations over time. It doesn’t necessarily bode ill or well for any particular station. Q100 and 99X used to be owned (until last year) by a privately-held company named Susquehanna. And Star 94 has been privately held for decades. Most of the major stations in town are owned by publicly traded companies: Cox (the Beat, B98.5, WSB-AM, the River, Kiss), Citadel (Kicks, Eagle), Radio One (Smooth Jazz, Grown Folks Radio, Hot, Praise), Clear Channel (El Patron, Viva, the Bull, Project, WGST-AM), Salem (e.g. the Fish, WGKA) and CBS (V-103, WAOK-AM, Dave FM). The Zone operates through a contract with Lincoln Financial, which owns Star. The Fan is privately held through Dickey Broadcasting, which is not owned by Cumulus despite the Dickey connection.
Comments
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By peter
July 23, 2007 1:39 PM | Link to this
Free the I-Man!
By Bud
July 23, 2007 2:27 PM | Link to this
They should go private. This will shift the massive losses in equity that terrestrial radio companies generate from lots of small shareholders to a few large shareholders.
By KimmerFan
July 23, 2007 6:09 PM | Link to this
Bring back the Kimmer!!! ATL radio has SUCKED since Clear Idiots dumped him and the Kimmer Krew.