Cumulus, Partners Buy Susquehanna Radio
October 31, 2005 at 7:54 AM (PT)
It's official: CUMULUS, in partnership with BAIN CAPITAL, the BLACKSTONE GROUP, and THOMAS H. LEE PARTNERS, is buying SUSQUEHANNA's radio business for about $1.2 billion. CUMULUS will hold a 25% interest in the SUSQUEHANNA RADIO assets and four other stations it will move from its own portfolio into the new group, CUMULUS MEDIA PARTNERS. Rock KIOL and Talk KFNC/HOUSTON and Top 40 KCHZ (Z-95.7) and Urban AC KMJK (MAGIC 107.3)/KANSAS CITY will be added to the new operation, and CUMULUS will get a quarterly fee for managing the stations, with incentives that could increase the company's share of the new company from 25% to 40%.
"SUSQUEHANNA is one of the radio industry's most admired companies because of the quality of its assets and the quality of its people," said CUMULUS Chairman/CEO LEW DICKEY in a statement. "We look forward to partnering with the management and employees of SUSQUEHANNA to continue their great tradition of serving listeners, advertisers and communities. The formation of CUMULUS MEDIA PARTNERS has also helped us accomplish our goals of monetizing our station assets in HOUSTON and KANSAS CITY and enabling our shareholders to benefit from the next wave of industry consolidation."
CUMULUS MEDIA PARTNERS will receive debt financing from DEUTSCHE BANK, MERRILL LYNCH, GOLDMAN SACHS, and UBS. DEUTSCHE BANK SECURITIES acted as exclusive financial advisor to CUMULUS and financial advisor (with GOLDMAN SACHS) to CUMULUS MEDIA PARTNERS.
At the same time, SUSQUEHANNA is selling its cable operation to COMCAST, which already owned 30% of the operation, for $440 million.