Cumulus Media is spinning dozens of stations to Townsquare Media as part of its plan to add Dial Global assets to its portfolio. Besides expanding Townsquare’s station portfolio by almost 30% on a stick-by-stick basis, it will solidify the group’s coverage of the Midwest and expand its presence in the Northeast.
“These transactions represent the continued evolution of Townsquare Media into one of the nation’s largest local media companies and allow us to reach a scale which opens the door to new strategic opportunities,” commented Townsquare Chairman and CEO, Steven Price. “The assets we are adding to our portfolio are market leading brands with strong competitive positions in their respective small and mid-sized markets. We are excited by the opportunity to deploy our differentiated local-media strategy across a broader footprint in order to better serve our communities and our advertising clients.”
The total value of the station transactions – there are three –will be an estimated $281M.
According to a WSJ report, $238M of that is attributed to the straight sale of 53 stations in 12 markets to Townsquare. Also on the table is the acquisition by Townsquare of five Fresno radio stations from Peak Media, which it will pass along to Cumulus in exchange for 15 more stations in two markets and a small amount of cash from Cumulus to balance out the station values. Townsquare is also acquiring Peak Media assets in Boise, leaving it with six Peak stations after the Cumulus swap.
Of the 71 stations coming from Cumulus, three will be placed in a divestiture trust; netting 68 total stations for TM; add in six keepers out of the 11 coming from Peak and TM will be expanding by 71.
Townsquare will be adding stations in the following markets:
Battle Creek, MI
Cedar Rapids, IA
Quad Cities, IA-IL
Cumulus will benefit from an influx of cash which it will use to make its Dial Global acquisition a reality.
RBR-TVBR observation: This is an awesome strategic move for Townsquare. It will be adding a large chunk of new real estate in areas of familiarity. TM should be able to seamlessly add them into its existing corporate operational framework. And it solidifies its claim to the title of America’s #3 radio group in terms of sticks. And of course, it zooms to the #1 spot in terms of striking the top deal as a buyer so far in 2013.