Audacy/Cumulus Rumors

[secondchoice]

Cell towers don't tend to conduct AM signals very well, and AM signals only have so many places they can move.

A shunt fed grounded tower could work well if the physical height is at least a quarter wave length and the ground radials are still intact. Another advantage of grounded towers is the lack of RF isolation modules on the other services and no no Austin ring transformers for tower lighting. Of course the nighttime power (if there is any) will have to be refigured.

One should assume Cumulus signed long term transferable leases (50 + years) when they sold the properties. There also should have been "business disruption" clauses too.

If any AM station has positive cash flow, I seriously doubt it will be signed off unless there is tremendous value for the land. Since Cumulus doesn't own the land, there is no reason for them to give up a station unless the landlord makes it "financially" worth it to them to give up the lease.

 

[TheBigA]

Audacy's acting CEO is now named President/CEO:

Audacy Officially Names Kelli Turner President/CEO.

Audacy made a series of executive changes, starting with the official naming of Kelli Turner as President and Chief Executive Officer. Turner had served as Interim President and CEO since

www.insideradio.com

 

[TheBigA]

Last week, Renew Radio led by billionaire Manoj Bhargava sold off a bunch of Cumulus shares

Renew Group Reduces Cumulus Stake As Takeover Tensions Fade - Radio Ink

After Cumulus lets its poison pill lapse, Renew Group offloads shares, easing concerns of a takeover by billionaire Manoj Bhargava.

radioink.com

So Cumulus stock has dropped to 45 cents. Looks like if there's a shot at a merger between Audacy & Cumulus, it won't come from Bhargava.

 

[TheBigA]

As we said, the Cumulus stock has been under $1 for a while, so today they left NASDAQ

Facing Delisting, Cumulus Media Moves Stock From Nasdaq.

Cumulus Media has decided to move its stock from Nasdaq to trading on the OTC market, “rather than investing time, effort, and cost into developing a plan to remain on

www.insideradio.com

It's deja vu, all over again.

 

[Barry]

According to the article, all of the shares of Cumulus are worth well under 7 million dollars, at current market prices.
Apparently it wasn't a good decision for Cumulus' management to turn down a buyout offer of around $15/share made by Connoisseur Media's CEO, in 2022.

 

[TheBigA]

According to the article, all of the shares of Cumulus are worth well under 7 million dollars, at current market prices.
Apparently it wasn't a good decision for Cumulus' management to turn down a buyout offer of around $15/share made by Connoisseur Media's CEO, in 2022.

Depends. According to press reports, the offer was "highly conditional." Perhaps those conditions were the killer.

However, if Cumulus lenders sold their shares the day the offer went public, they would have realized a 40% increase in value.

My view is Warshaw has had many opportunities to buy other radio, and so far, he's kept whatever powder he has dry.

 

[Barry]

In rejecting the offer at the time, Cumulus' CEO said, "The Board unanimously concluded that the indication of interest significantly undervalues the Company and is not in the best interests of its shareholders.” I wonder whether they still feel that way.

2022 Buyout Offer

 

[TheBigA]

I wonder whether they still feel that way.

I wonder if those shareholders still own that stock. I bet they don't. That was 3 years ago.

The article says the offer was contingent on Warshaw being allowed to do some "due diligence." That means he wanted to look inside their books. Maybe get some competitive information. Not always a good idea. So he noses around, gets the information he needs, and then says no. That damages the company.

 

[secondchoice]

I wonder if those shareholders still own that stock. I bet they don't. That was 3 years ago.

The article says the offer was contingent on Warshaw being allowed to do some "due diligence." That means he wanted to look inside their books. Maybe get some competitive information. Not always a good idea. So he noses around, gets the information he needs, and then says no. That damages the company.

That's where a good lawyer puts in provisions that puts a time limit his purchase of other radio properties. Also having an independent accounting firm audit the books to find hidden "time bombs" in the accounts receivable and especially payable. Shouldn't be too hard after the Bankruptcy allowed them to screw the small venders and shareholders. Also leaving bankruptcy and getting listed the company usually follows Generally Accepted Accounting Principles.

 

[TheBigA]

That's where a good lawyer puts in provisions that puts a time limit his purchase of other radio properties.

It's easier to just reject the offer. That's what they did.

 

[secondchoice]

It's easier to just reject the offer. That's what they did.

Easy cost shareholders around $14+ a share!! The thing about public held corporations "board of directors" they are supposed to really take care of the shareholders. Unless Cumulus had enough earnings (at least $4 dollar a share annually) where that was a low-ball offer, they really did the shareholder's a disservice by not using him as a "stalking horse" bidder.

 

[Voicetrack of Reason]

I wonder if those shareholders still own that stock. I bet they don't. That was 3 years ago.

The article says the offer was contingent on Warshaw being allowed to do some "due diligence." That means he wanted to look inside their books. Maybe get some competitive information. Not always a good idea. So he noses around, gets the information he needs, and then says no. That damages the company.

I don't know about that. A lot of the damage to Cumulus has seemed to be self inflicted to me.

 

[TheBigA]

Easy cost shareholders around $14+ a share!!

That's how it goes when you're a lowly stockholder. You give them your money and trust them to do the right thing. Anyone who bought stock in Cumulus after the bankruptcy was either taking a huge risk, or bought for the short term. If they did the latter, they sold when the stock jumped up 40% on the Warshaw story. You gotta know when to hold em, know when to fold em.

The thing about public held corporations "board of directors" they are supposed to really take care of the shareholders.

After a bankruptcy, the board is made up of the former lenders who received equity instead of money. Their only interest is themselves.

 

[TheBigA]

I don't know about that. A lot of the damage to Cumulus has seemed to be self inflicted to me.

Could be. For that, the founder of the company was fired.

 

[Kent]

Easy cost shareholders around $14+ a share!!

We don't know for sure how easy saying no to that offer was. Having said that, I suspect most of the shareholders of Cumulus wish today that they'd have taken that deal. I also wouldn't be surprised if Warshaw makes another offer now that the stock price is down as far as it is. Rumor has been that he's still trying to pull off a big deal. If he makes another offer for Cumulus, it probably won't be nearly as high, but it will have to be more than today's stock value.

The thing about public held corporations "board of directors" they are supposed to really take care of the shareholders. Unless Cumulus had enough earnings (at least $4 dollar a share annually) where that was a low-ball offer, they really did the shareholder's a disservice by not using him as a "stalking horse" bidder.

As the Big A mentions, the current board is essentially the lenders. It's been that way at Cumulus since at least the Citadel deal if not longer. Under the Dickeys, Cumulus had a long history of using stock transactions to buy properties, and the Citadel deal involved a lot of equity. Cumulus never had debt the traditional way we think of it. It had owners who owed the bulk of the money to themselves. That worked until it didn't, hence the bankruptcy. It has the same situation today, but with different owners. That situation is sustainable almost indefinitely. Those investment firms have almost unlimited loads of cash. Unless one starts grumbling or otherwise has problems elsewhere in its portfolio (which I suppose can't be discounted with this volatile stock market), they can hold out as long as they want. Everything is for sale at the right price, and the owners will sell when their price is met. The other shareholders are along for the ride at this point.

 

[TheBigA]

I suspect most of the shareholders of Cumulus wish today that they'd have taken that deal.

Keep in mind that a third of the stock is owned by company insiders, including members of the board who made the decision. CEO Mary Berner owns 6% of the stock. The biggest stockholder was the owner of Five Hour Energy. He has since sold some of his stock, likely at a loss.

Bhargava's Cumulus Selloff Continues; Takeover Bid All But Over - Radio Ink

Billionaire Manoj Bhargava and Renew Group Private Ltd. have reduced their stake in Cumulus Media to 7.2%, according to a new SEC filing.

radioink.com

 

[TheBigA]

Manoj Bhargava has sold off the last of his Cumulus shares:

Renew Group Offloads Final Cumulus Shares Amid Nasdaq Exit - Radio Ink

Renew Group has fully exited its investment in Cumulus Media, just as the broadcaster prepares to delist from Nasdaq.

radioink.com

It was his investments in both Audacy & Cumulus that originally sparked this rumor:

Latest On Audacy’s New Owners And A Potential Cumulus Media Combination

Last night Semafor publicly reported on something that has been whispered for much of the past year; a potential combination

radioinsight.com

The potential connection between Audacy and Cumulus dates back to last summer when 5-hour Energy founder Manoj Bhargava purchased 5.15% of Cumulus and acquired $60 million of Audacy’s debt.

AFAIK he still retains the Audacy debt.

 

[secondchoice]

If he buys Cumulus "debt" and they revisit bankruptcy then he will be in position to do a deal after everybody gets out of receivership. Sorta like the Delta - Northwest airline deal.

 

[TheBigA]

If he buys Cumulus "debt" and they revisit bankruptcy then he will be in position to do a deal after everybody gets out of receivership. Sorta like the Delta - Northwest airline deal.

The company reported a net loss of $32 million for the 1st quarter, up from $14 million last year. Things are not improving. The current debt is $670 million.

Cumulus Posts Q1 Loss, Moves Stock to OTC - Radio World

Cumulus Media posted a decline in revenue and a net loss in Q1.

www.radioworld.com

 

[JJSPC]

The company reported a net loss of $32 million for the 1st quarter, up from $14 million last year. Things are not improving. The current debt is $670 million.

Cumulus Posts Q1 Loss, Moves Stock to OTC - Radio World

Cumulus Media posted a decline in revenue and a net loss in Q1.

www.radioworld.com

Will be time to shut off some more AM's and secondary FM's again soon.