In the year since its emergence from bankruptcy, Cumulus Media has done much to reduce its outstanding debt.
On Wednesday (6/5), the company headed by CEO Mary Berner took a giant step in further reducing that outstanding balance.
Cumulus Media has made a voluntary prepayment of $115 million on its first lien senior secured term loan.
This means that since its emergence from debtor-in-possession status, Cumulus has reduced its total outstanding debt by $200 million.
Additionally, Cumulus’ net leverage has now declined from approximately 5.8x at emergence to approximately 4.8x with this payment.
The debt prepayment is being funded by the net proceeds of the just-completed sale of six radio stations — including WPLJ-FM in New York and WRQX-FM in Washington, D.C. — to Educational Media Foundation, for $103.5 million in cash.
Additional cash on hand generated from operations was also put toward the voluntary prepayment.
Meanwhile, Cumulus noted that its $43 million sale of KLOS-FM in Los Angeles to Meruelo Media is still expected to close in the third quarter, and that its net proceeds will also be used to pay down debt.
“In our ongoing efforts to strengthen the business, Cumulus has been relentlessly focused on executing our key strategic priorities and meeting our financial objectives,” said Cumulus President/CEO Mary Berner. “The milestone we achieved today — $200 million of debt reduction in the first year since we emerged from Chapter 11 — resulted from those efforts and is another example of the progress we continue to make in implementing our business plan.”
Berner thanked all at Cumulus “for the hard work and dedication which have produced such a tremendous record of achievement over the past year,” and concluded that she has “every confidence that, together, we will be able to further improve our financial position and continue to deliver on the goals we have laid out for the business.”
