Atlanta – Radio station owner Cumulus Media on Thursday
announced that it will merge with rival Citadel Broadcasting, whereby it will
acquire all Citadel shares in a deal valued at $2.4 billion.
Citadel owns and
operates 225 radio stations in over 50 markets. After the transaction is completed,
Cumulus will own 572 radio stations in 120 U.S. markets.
The company, which
previously had its $1 billion bid rejected by Citadel, believes the deal will
provide it with "critical mass necessary to effectively compete and invest
in the local digital media marketplace."
Cumulus says it has secured up to
$500 million in equity financing from Crestrive Partners and Macquarie Capital,
and commitments from a group of banks for up to $2.525 billion in credit and
$500 million in bridge financing — the proceeds of which will be used to pay
the cash portion of the merger consideration, and effect refinancing of its own
and Citadel’s debt.