Cumulus Media on Monday made an SEC filing that outlined its long-term financial forecast and business plan — a filing precipitated by separate discussions Cumulus says it has had with “certain noteholders under the indenture governing the 7.75% Senior Notes due 2019.”
The key words here are “restructuring” — it is negotiating with its noteholders on a potential restructuring deal, and that’s name Cumulus stock holders very nervous.
Word got out on the filing after 2pm Eastern Monday. That’s when Cumulus’ stock halted its drive upward and sailed into the red. That journey southward continued Tuesday.
At the Closing Bell, Cumulus stock landed at $0.262 cents, down 9.66% from Monday’s close.
With 1.34 million shares traded (average volume is 809,584 shares), CMLS is closer than ever to record lows seen in mid-April.
Cumulus’ market cap stands at 7.7 million, with its stock at a 1-year target estimate of 50 cents.
Earlier this month Cumulus opted to skip a $23.6 million interest payment on the 7.75% senior notes due 2019; it will default if a payment is not made by Dec. 1.
Under an out-of-court restructuring plan proposed by Cumulus, senior lenders, who are owed $1.72 billion, would receive $350 million plus cash on the company’s balance sheet to pay down part of the loan. The remaining amount will be reinstated. Some 98% of the bondholders would need to agree to the restructuring plan to complete the restructuring outside of bankruptcy court.
Additional reporting by Adrian Zupp