Cumulus Media

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Cumulus Media, Inc.
Type Public
Traded as NASDAQCMLS
Industry Entertainment
Founded 1997
Headquarters Atlanta, Georgia, US
Key people Lewis W. Dickey, Jr., Chairman, President & CEO ; Jonathan G. Pinch, Executive Vice President & Co-COO; John W. Dickey, Executive Vice President & Co-COO; Richard S. Denning, Senior VP, Secretary & General Counsel; Joseph P. Hannahan, Senior VP, Treasurer & CFO[1]
Products Radio
Revenue $1,026,138,000 (2013) [2]
Employees 4,058 full time[3]
Website cumulus.com

Cumulus Media, Inc. (and its subsidiaries, Cumulus Broadcasting LLC, Cumulus Licensing LLC and Broadcast Software International Inc[4] ) is an American broadcasting company and is the second largest owner and operator of AM and FM radio stations in the United States, behind iHeartMedia, Inc. (formerly Clear Channel Communications), operating 460 stations in 89 markets as of February 27, 2014[5] as compared to 570 stations in 150 markets as of September 16, 2011.[6] The company also owns Westwood One. Cumulus's headquarters are located in Atlanta, Georgia.

Cumulus' original business plan focused exclusively on owning radio stations located in medium sized media markets,[7] and Cumulus Media only owns terrestrial radio stations in the United States; rival iHeartMedia, Inc. owns radio stations outside the United States and operates a subsidiary, Clear Channel Outdoor.[8]

Company history[edit]

In 2006, Cumulus acquired control of Susquehanna Radio, with the backing of 3 venture capital firms (Bain Capital Partners LLC, The Blackstone Group and Thomas H. Lee Partners, L.P.) for a price of $1.2 Billion. The 33 Susquehanna stations were privately held in a separate partnership called Cumulus Media Partners, LLC (commonly referred to as CMP on the company's quarterly earnings calls) that was the subject of an equity-for-debt swap in May 2009 in an attempt to avoid defaulting on the terms of the CMP lending agreement. While Cumulus operated the CMP stations, they initially held only a minor ownership interest in them.[9] On January 31, 2011, Cumulus announced a deal to acquire the remaining ownership of CMP from its equity partners in a stock transaction valued at approximately $740 million that is closed in August 2011.[10] As a result of the CMP acquisition, Cumulus now owns a limited-partnership interest in San Francisco Baseball Associates LP, the owner of the San Francisco Giants baseball club.[11]

In July 2010, Cumulus publicly announced formation of a similar venture with Crestview Partners to acquire up to $1 billion of additional radio assets.[12]

In July 2007, the company announced its intention to "go private",[13] however on May 11, 2008, the company announced it was unable to come to terms with the parties involved and the merger/acquisition agreement was terminated.[14]

Like most major American radio station owners, Cumulus has been forced to write down the value of its radio station licenses, resulting in large non-cash losses - $498.9 million in 2008, $230.6 million in 2007, and $63.4 million in 2006.

The company's stock, priced over $56 in 1999,[15] then over $22 in 2004, was as low as $0.45 per share toward the end of 2008.[16][17]

Acquisition of Citadel Broadcasting and Dial Global[edit]

Starting in June 2010, Cumulus made multiple unsuccessful offers to buy out Citadel Broadcasting after its emergence from bankruptcy.[18] In February 2011, Cumulus was again said to be in "exclusive negotiations" to acquire Citadel for $2.5 billion paid to Citadel shareholders, according to CNBC. Some Citadel shareholders were said to have been pushing the board to consider a sale.[19] On March 10, 2011, Citadel Broadcasting stations announced via email that Cumulus had purchased Citadel Broadcasting. Citadel was made up of 225 radio stations in over 50 markets, as well as Citadel Media, one of the largest radio networks in the United States. The deal was finalized on September 16, 2011, after acceptance by the FCC and Citadel's shareholders.[20] As part of the deal, Cumulus Media will have to place 14 stations into a separate trust to comply with ownership limits.[21] Following the acquisition, in an effort to focus on larger markets, Cumulus reached a deal with Townsquare Media to swap 65 radio stations in 13 markets, with the majority of the 65 stations being sold to Townsquare.[22]

On August 29, 2013, it was reported by The Wall Street Journal that Cumulus would purchase the syndicator Dial Global for $260 million. To fund the sale, Cumulus, sold 53 more stations to Townsquare for $238 million, in markets such as Danbury, CT, Rockford, IL, Cedar Rapids, IA, Quad Cities IA/IL, Waterloo, IA, Portland, ME, Battle Creek, MI, Kalamazoo, MI, Lansing, MI, Faribault, MN, Rochester, MN, and Portsmouth, NH. Additionally, Townsquare Media acquired Peak Broadcasting, and Cumulus swapped 15 more stations in Dubuque, IA and Poughkeepsie, NY in exchange for Peak Broadcasting’s Fresno cluster.[23][24] The sale to Cumulus was completed on November 14, 2013.[25]

Launch of Nash, CNN partnership[edit]

On January 11, 2013, after acquiring the station from Family Radio, Cumulus re-launched WFME in New York City as a country music station under its new Nash FM brand. Nash was designed to serve as an umbrella brand for all country music-related content across the company's properties, including radio, digital, and live events such as the "Nash Bash". All country stations owned by Cumulus would either be branded as Nash FM, or be strongly cross-promoted as part of the Nash family of properties.[26][27]

In July 2014, Cumulus announced that it would end its partnership with ABC News Radio, and enter into a new partnership with CNN to syndicate news content for its stations through Westwood One beginning in 2015. The network will provide its content on a white label basis, allowing individual stations to use their own brands for the content. In turn, ABC announced that it would take the syndication of its radio content in-house, with distribution handled by Skyview Networks.[28][29]

FCC actions[edit]

On December 30, 2008, Cumulus Media was issued a $14,000 Notice of Apparent Liability by the Federal Communications Commission related to the stations in the Macon, Georgia, cluster. The FCC says Cumulus failed to comply with its record-keeping requirements and its Equal Employment Opportunity rules on information on recruitment sources. Cumulus, along with two other companies, had 30 days to pay or file a statement asking for reduction or cancellation of the forfeitures.[30]

Restatement[edit]

On March 17, 2000, the company was forced to restate revenue and broadcast cash flow for three quarters of 1999 after discovering that some of its sales force had prematurely booked revenue to meet sales goals.[31] On November 8, 2005, Company decided to amend and restate its results for the second quarter of 2005.[32]

See also[edit]

References[edit]

  1. ^ "Corporate Officers". Cumulus Media. Retrieved 23 March 2014. 
  2. ^ "Cumulus Media Inc. (CMLS)". Yahoo! Finance. Retrieved 23 March 2014. 
  3. ^ "Cumulus (CMLS) Business Summary". Yahoo! Finance. Retrieved 23 March 2014. 
  4. ^ "Subsidiaries of Cumulus Media Inc". U.S. Securities and Exchange Commission. October 14, 2013. Retrieved 23 March 2014. 
  5. ^ "CMLS Company Profile". Yahoo Finance. Retrieved 23 March 2014. 
  6. ^ "211 Cumulus Now Owns Citadel Broadcasting". Business Journal. September 16, 2011. Retrieved 2011-09-16. 
  7. ^ Fybush, Scott. "Cumulus The Comeback Kid". Radio World. Retrieved 23 March 2014. 
  8. ^ "Clear Channel Business Summar". Yahoo!. Retrieved 23 March 2014. 
  9. ^ Radio Business Report/Television Business Report - Voice of the Broadcasting Industry
  10. ^ [1]
  11. ^ Cumulus Media, Inc. (December 31, 2012). "Notes to consolidated financial statements". Annual report to the Securities and Exchange Commission on Form 10-K. p. F-14.
  12. ^ "Cumulus Media and Crestview Form Venture". New York Times. 8 April 2010. Retrieved 23 March 2014. 
  13. ^ "Cumulus Agrees to $1.3 Billion Buyout". New York Times. July 4, 2007. Retrieved 23 March 2014. 
  14. ^ "Cumulus Buyout Is Terminated". New York Times. May 12, 2008. Retrieved 23 March 2014. 
  15. ^ "NASDAQ:CMLS stock chart 1998-2014". google.com. June 29, 2014. 
  16. ^ "Cumulus CEO: "Half the companies in radio gone in 36 months"". Radio-Info.com. November 24, 2008. 
  17. ^ "NASDAQ:CMLS stock chart 2004-2014". nasdaq.com. June 29, 2014. 
  18. ^ "Citadel says "No" to two merger offers from Cumulus". Radio-Info.com. December 6, 2010. 
  19. ^ "Citadel confirms "exclusive negotiations" with Cumulus – but says "no deal yet"". Radio-Info.com. February 17, 2011. 
  20. ^ "211 Cumulus Now Owns Citadel Broadcasting". Business Journal. September 16, 2011. Retrieved 2011-09-16. 
  21. ^ "Cumulus files to divest 14 stations, to complete its $2.4B purchase of Citadel". Radio-Info.com. April 12, 2011. 
  22. ^ Townsquare and Cumulus swap 65 stations in 13 markets - Radio-Info.com (released April 30, 2012)
  23. ^ "Official: Cumulus Buys Dial Global, Spins Some Stations To Townsquare; Peak Stations Sold To Townsquare, Fresno Spun To Cumulus". All Access. August 30, 2013. Retrieved August 30, 2013. 
  24. ^ "Cumulus Makes Dial Global And Townsquare Deals Official". RadioInsight. August 30, 2013. Retrieved August 30, 2013. 
  25. ^ "Cumulus-Townsquare-Peak Deal Closes". All Access. November 15, 2013. Retrieved November 16, 2013. 
  26. ^ McKinley Jr., James C. (21 January 2013). "New York Radio Gets a New Country Station". The New York Times. Retrieved 21 January 2013. 
  27. ^ "Cumulus' Lew Dickey Explains Why NYC's New NASH-FM 'Is Good for Nashville' at CRS". Billboard. Retrieved 12 December 2014. 
  28. ^ "ABC News radio deal with Cumulus to end, but there’s an upside". Capital New York. Retrieved 12 December 2014. 
  29. ^ "Cumulus taps CNN for Westwood One news service". Atlanta Business Chronicle. Retrieved 12 December 2014. 
  30. ^ FCC Issues EEO Notices - Radio Ink (released December 30, 2008)
  31. ^ "Milwaukee-Based Radio-Station Owner Restates Revenue, Cash Flow". 
  32. ^ "Cumulus Reports Third Quarter 2005 Results". 

External links[edit]