Cumulus Media Sells KLOS To Meruelo Media; Swaps Bridgeport To Connoisseur For Allentown
Cumulus Media has announced two more deals.
The rumored sale of Rock 95.5 KLOS Los Angeles to Meruelo Media is now official as Meruelo pays $43 million for the station. Meruelo will begin operating KLOS via LMA on Tuesday, April 16. KLOS joins a Meruelo cluster that includes Classic Hip-Hop “93.5 KDAY” KDAY Redondo Beach/KDEY Ontario and Rhythmic CHR “Power 106” 105.9 KPWR Los Angeles. Cumulus retains Talk 790 KABC Los Angeles.
Cumulus also has announced it has swapped News/Talk 600 WICC Bridgeport and AC “WeBe 108” 107.9 WEBE Westport CT to Connoisseur Media for Connoisseur’s Classic Rock “99.9 The Hawk” WODE Easton, Alternative “107.1 Spin Radio” WWYY Belvedere NJ/94.7 W234AX Allentown PA, and Sports “Fox Sports LV” 1230 WEEX Easton/1320 WTKZ Allentown.
The swaps allow both companies to grow in their respective markets as Cumulus owns Country “Cat Country 96” WCTO Easton and AC 100.7 WLEV Allentown in the Allentown market and Connoisseur owns Classic Rock “95.9 The Fox” WFOX-FM Norwalk and AC “Star 99.9” WEZN Bridgeport in Fairfield County CT. Both companies will begin their respective LMAs on May 1.
Cumulus Media Inc. [NASDAQ: CMLS] (the “Company,” “Cumulus,” “we,” “us,” or “our”) today announced that it has entered into an agreement to sell KLOS-FM in Los Angeles, CA to Meruelo Media, a division of the Meruelo Group, for $43 million in cash. Cumulus also announced that it has entered into a swap agreement with Connoisseur Media under which Cumulus will obtain four stations in and around Allentown, PA in exchange for two Cumulus stations in Southern Connecticut.
Mary G. Berner, President and Chief Executive Officer of Cumulus, said, “These transactions are part of the continued execution of our portfolio optimization strategy. Both transactions are accretive, and the sale of KLOS-FM to Meruelo Media at an attractive multiple allows us to generate substantial cash, which can be used to further pay down debt and invest in high potential business opportunities. The Connoisseur Media swap significantly strengthens our presence in Allentown and the Lehigh Valley.”
Under the terms of the agreement with Meruelo Media, Meruelo Media will acquire KLOS-FM in Los Angeles, CA for a purchase price of $43 million. Meruelo Media will begin programming KLOS-FM under a Local Marketing Agreement on April 16, 2019.
Under the terms of the agreement with Connoisseur Media, Cumulus will receive WODE-FM, WWYY-FM, WEEX-AM and WTKZ-AM in and around Allentown, PA and Connoisseur Media will receive WEBE-FM in Westport, CT, and WICC-AM in Bridgeport, CT. The parties will begin programming each other’s respective stations under Local Marketing Agreements on May 1, 2019.
Moelis & Company LLC represented Cumulus as financial advisor in the sale of KLOS-FM to Meruelo Media. MVP Capital represented Cumulus as financial advisor in the swap with Connoisseur Media. Jones Day represented Cumulus as legal counsel on both transactions.
Approvals and Timing to Close
Both transactions are subject to customary closing conditions, including regulatory approval. Cumulus expects to complete both transactions in the third quarter of 2019.
Meruelo Group announced today that its media division, Meruelo Media, entered into an agreement with Cumulus Media Inc. [NASDAQ: CMLS] to purchase KLOS-FM in Los Angeles. KLOS-FM will join KPWR, KDAY, KDEY-FM, KWHY-TV, and KBEH as the sixth broadcast station in Meruelo Media’s Los Angeles cluster.
“KLOS 95.5 is one of the most iconic Rock stations in the world. We are thrilled to add this legendary brand to our Media Division,” stated Alex Meruelo, Chairman and CEO of the Meruelo Group.
Otto Padron, President of Meruelo Media, added, “KLOS will be a crown piece in our strategically curated, LA-focused multimedia portfolio. As we’ve done with all our media properties, we will take full advantage of our deep local resources to grow the globally recognized KLOS heritage rock brand for generations to come.”
Effective April 16, 2019, Meruelo Media will take over programming of KLOS under a Local Marketing Agreement. Mr. Padron expects the transaction to be completed in the third quarter of 2019, after customary regulatory approvals are obtained.
Connoisseur Media announced today that it has executed an asset exchange agreement with Cumulus Media Inc. whereby Connoisseur Media will acquire two stations in Southern Connecticut in exchange for four stations in and around Allentown, Pennsylvania.
The stations being acquired by Connoisseur Media are licensed to Westport (WEBE-FM) and Bridgeport (WICC-AM), Connecticut and the stations being traded to Cumulus Media are located in and around Allentown, Pennsylvania (WODE-FM, WWYY-FM, WEEX-AM, WTKZ-AM and translator W234AX). An LMA for the stations for each respective party will begin May 1, 2019. The exchange is expected to close in the third quarter of 2019, pending FCC approval.
“As a Connecticut-based company, this transaction represents an exceptional opportunity to continue to invest in the southern part of the state and will offer more ways for us to serve our listeners, clients and community,” commented Connoisseur Media CEO Jeffrey Warshaw. “As a resident of Westport, the home to WEBE 108, I am thrilled to add these legendary stations to our Connecticut operations.”
“As a lifelong Connecticut resident and the former General Sales Manager of WEBE/WICC, it is my privilege to lead these stations,” said Connoisseur Media SVP/Market Manager Kristin Okesson. “The combined reach of our portfolio will offer exciting opportunities for our partners and to the communities we serve. We are acquiring premier radio stations and a talented team which will allow us to expand our position in Fairfield County.”
Connoisseur Media has owned the Allentown stations being exchanged with Cumulus for the last six years. Connoisseur Media CEO Jeffrey Warshaw commented “We are very proud of our stations in Allentown and have a tremendous respect for their tradition of success and service to the community.” Connoisseur Media COO David Bevins added “We have terrific employees in Allentown and are sure they will carry that success to Cumulus.”
Connoisseur Media is headquartered in Westport, CT. Upon the closing of this asset exchange, and a previously announced asset exchange, Connoisseur Media will own and/or operate 23 radio stations in seven markets: Billings, MT; Bridgeport, Stamford/Norwalk and New Haven, CT; Nassau – Suffolk (Long Island), NY; Frederick, MD and Stroudsburg-Wilkes-Barre, PA.