Cumulus Media reigns over an empire of radio stations. The company is the #2 radio station ownership group in the US (behind Clear Channel), with more than 520 owned or operated stations in about 110 markets throughout the country. In many of its markets, Cumulus has built clusters of stations that realize cost savings through shared administrative and sales operations. In addition to its core mid-market stations, Cumulus, through a partnership with a group of private equity firms, owns about 30 stations in such large markets as Atlanta, Dallas, and San Francisco. Chairman and CEO Lewis Dickey, along with his family, controls about 45% of Cumulus Media.
Weakness in the broadcasting business has also created opportunities for acquisitions as broadcasters needing cash look to dispose of their properties. In 2010, Cumulus Media formed an investment partnership called Cumulus Radio Investors with private equity firm Crestview Partners with the intention of purchasing smaller broadcasting operations and stations as they become available. Cumulus Radio Investors is being funded with as much as $500 million in equity and could spend as much as $1 billion on acquisitions with debt financing.
In 2011, Cumulus Media purchased Citadel Broadcasting. The deal was valued at roughly $2.5 billion.
Using investment partnership to acquire stations is not a new strategy for Cumulus Media. In 2006 it formed Cumulus Media Partners with private equity firms Bain Capital, The Blackstone Group, and Thomas H. Lee to purchase about 30 big-market stations from holding company Susquehanna Pfaltzgraff. That deal was valued about $1.2 billion.
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