Cumulus Board Rejects Warshaw Buyout Bid
• Last month a consortium led by Jeff Warshaw, Founder & CEO of Connoisseur Media submitted an offer to acquire Cumulus Media for $15-$17 per share (nearly $1.2 billion), including debt. On Wednesday, the Cumulus Board Of Directors rejected the bid, saying the price “significantly undervalues the company.” [At press time Cumulus stock was at 13.41].
On Wednesday, as part of a shareholder letter, Cumulus Pres. & CEO Mary Berner addressed what was described as an “Unsolicited, Non-Binding, Highly Conditional Indication of Interest,” stating, “The Company recently received an indication of interest in acquiring the Company for $15.00 to $17.00 per share. After a careful and thorough review, conducted in consultation with our financial and legal advisors, the Board unanimously concluded that the indication of interest significantly undervalues the Company and is not in the best interests of its shareholders.
The Company’s Board is open to all paths that continue to drive superior shareholder value. Our strong momentum across business lines, multiple digital revenue growth drivers, operational efficiency and superior cash flow provide the Company with substantial untapped upside that it expects to continue to realize on behalf of its shareholders. Given these facts and circumstances, the Board unanimously believes execution of the Company’s strategy will deliver significantly more value to shareholders than this indication of interest.”
[Ed. note: This may only be round one — when Warshaw’s consortium submitted its initial offer on April 15, Warshaw indicated that he would be willing to pay more, subject to due diligence. Now we wait…]
