Cumulus Goes Dutch On Stock Buyback
• Cumulus Media Inc. announced that it intends to commence a “modified Dutch auction” tender offer to purchase up to $25 million of shares of its Class A common stock, or such lesser number of shares of its Class A common stock as are properly tendered and not properly withdrawn, at a price not greater than $16.50 and not less than $14.50 per share of Class A common stock, to the tendering shareholder in cash, less any applicable withholding taxes and without interest. The Offer will be made upon the terms and subject to the conditions that will be described in the offer to purchase and in the related letter of transmittal that will be distributed to shareholders and filed with the U.S. Securities and Exchange Commission (SEC). The Company plans to commence the Offer today, May 6, 2022, with an expiration at the end of the day on June 3, 2022, unless extended or earlier terminated by Cumulus.
Mary G. Berner, Pres. & CEO of Cumulus Media, said, “Following yesterday’s announcement of the Board’s authorization of a $50 million share buyback program, we are launching this tender as a first step in our capital return plan. This action is underpinned by our strong financial and operating momentum, our continued belief that the Company is significantly undervalued and our desire to allow shareholders who seek it the ability to take advantage of the liquidity we can provide them. It is also our expectation that, even with this tender offer, we will be below our target of 3.5x net leverage by year end with significant continuing liquidity and financial flexibility for accretive M&A.”
Cumulus will conduct the Offer by means of a procedure commonly called a “modified Dutch auction,” which allows shareholders to select the price, within a price range specified by Cumulus, and the number of shares they are willing to sell at that price (or, should a higher price be determined as the “purchase price,” such higher price). The Offer is being made under Cumulus’s previously announced $50 million share repurchase program. Cumulus believes that the repurchase of Sh
