RBR-TVBR exclusive
If all goes according to plan, Cumulus Media will close on its acquisition of Citadel Broadcasting for around $2.5 billion on September 15th. Cumulus CEO Lew Dickey will be running a much, much larger company – so he’s getting ready.
In our exclusive interview, RBR-TVBR Executive Editor Jack Messmer asked Dickey what will be changing once Cumulus balloons in size.
| Dickey Clip 1: |
There will also be changes on Wall Street, with Cumulus becoming far and away the biggest pure-play radio company. Dickey has already expanded the stock float by rolling up CMP, but the much larger Citadel acquisition will put a lot more shares in public hands.
| Dickey Clip 2: |
(Note: Dickey obviously meant to say “when we complete the Citadel acquisition,” not “Cumulus acquisition.”)
The $610 million in senior notes due 2019 were priced with a coupon of 7.75% back in the spring. More recently, as the credit markets began to tighten, the lead banks for the deal placed senior secured financing of $2.415 billion, consisting of: a $1.325 billion first lien term loan facility, with a maturity date that is seven years from the closing of the merger; a $790.0 million second lien term loan facility, with a maturity date that is seven and one-half years from the closing of the merger; and a $300.0 million revolving credit facility, with a maturity date that is five years from the closing of the merger.
“Borrowings under the First Lien Term Loan are expected to be priced at LIBOR plus 4.5%, subject to a LIBOR floor of 1.25%, and will be secured by a first priority lien on substantially all of Cumulus Media’s and its restricted subsidiaries’ assets. Borrowings under the Second Lien Term Loan are expected to be priced at LIBOR plus 6.0%, subject to a LIBOR floor of 1.5%, and will be secured by a second priority lien on substantially all of Cumulus Media’s and its restricted subsidiaries’ assets,” according to proxy materials filed with the SEC.
For more of the exclusive RBR-TVBR interview of Lew Dickey:
Cumulus targets September 15 closing for Citadel (audio)
Lew Dickey expects more consolidation in radio (audio)
