Townsquare Media’s plans to bulk up with stations from Cumulus and Peak will increase its footprint in its regions, and according to Moody’s, it will do so without causing any significant damage to its debt profile.
At the end of the day, Townsquare will be reeling in 78 stations, five of which will be swapped to Cumulus and three of which will be placed in a divestiture trust.
Moody’s observed, “The transactions are credit positive for Townsquare, although there is no immediate change in ratings, as they expand the company’s scale and presence in regional markets without meaningfully increasing leverage. Proposed funding includes $16 million of equity, allowing the company to remain in compliance with the 2.40x senior leverage test under its credit agreement as well as the 2.0x senior leverage and 6.0x total leverage incurrence tests under its indenture.”
When everything closes, Townsquare will be the owner and operator of more than 300 stations, mostly in markets ranked 100 or smaller.
According to Moody’s, Townsquare began its existence by taking stations from the old Regent group out of bankruptcy, and added via deals with GAP Radio Broadcasting, Millennium Radio Group and Double O Corporation. And oh year, an earlier deal with Cumulus.