Cumulus Media Announces New Further Extension of Expiration Time in Exchange Offer and Consent Solicitation Relating to 6.750% Senior Secured First-Lien Notes due 2026

Rhea-AI Summary

Cumulus Media Inc. extends Exchange Offer and Consent Solicitation deadline for Senior Secured First-Lien Notes, offering to exchange Old Notes for New Notes with terms outlined in the Offering Memorandum. The New Further Extended Expiration Time is set for April 12, 2024, allowing holders to receive $770.00 principal amount of New Notes. Approximately $15 million aggregate principal amount of the Old Notes had been tendered as of April 9, 2024.

Insights

Financial Analyst

The extension of the expiration time for Cumulus Media's exchange offer and consent solicitation indicates a strategic move to manage the company's debt profile. By offering to exchange the existing 6.750% notes for new 8.750% notes with a later maturity date, Cumulus is essentially seeking to extend the debt's maturity and potentially ease short-term liquidity pressures. The increased interest rate on the new notes suggests that the company is willing to incur higher interest costs to achieve this extension.

From a financial perspective, the key consideration for stakeholders is the trade-off between the immediate increase in interest expenses versus the benefit of deferring the principal repayment. The market's response to this offer, as evidenced by the amount of old notes tendered, will reflect investor confidence in Cumulus's long-term financial health and its ability to meet higher interest obligations. It's also noteworthy that the offer is targeted at 'qualified institutional buyers' and 'non-U.S. persons', which could indicate a strategic focus on sophisticated investors with a higher risk appetite.

Debt Market Analyst

Examining the terms of the exchange offer, the shift from 6.750% to 8.750% in interest rates is significant, as it represents a 200 basis points increase. This could be a reflection of the current credit risk assessment of Cumulus by the market or a higher prevailing interest rate environment. The extension of the deadline may suggest that the initial uptake was lower than expected, possibly due to the Old Notes holders' valuation of the creditworthiness of Cumulus or alternative investment opportunities available in the market.

Investors holding the Old Notes need to consider the opportunity cost of accepting the exchange offer. They must weigh the higher yield against the potential risk of default and the longer duration until maturity. The terms of the exchange offer, such as the inability to withdraw tendered notes after a certain date, also play a important role in the decision-making process for these investors.

ATLANTA, April 10, 2024 (GLOBE NEWSWIRE) -- Cumulus Media Inc. (NASDAQ: CMLS) (the “Company” or “Cumulus”) today announced that its subsidiary, Cumulus Media New Holdings Inc. (the “Issuer”), has further extended the Expiration Time in its previously-announced Exchange Offer and Consent Solicitation (the “Exchange Offer and Consent Solicitation”), in which the Issuer offered to exchange any and all of the Issuer’s outstanding 6.750% Senior Secured First-Lien Notes due 2026 (the “Old Notes”) for new 8.750% Senior Secured First-Lien Notes due 2029 (“New Notes”), to be issued by the Issuer, upon the terms of and subject to the conditions set forth in the confidential offering memorandum and consent solicitation statement dated February 27, 2024 (the “Offering Memorandum”). Capitalized terms used but not defined in this press release have the respective meanings ascribed to such terms in the Offering Memorandum.

The Issuer is further extending the previously announced Further Expiration Time, which was 5:00 p.m., New York City Time, on April 9, 2024, to 5:00 p.m., New York City Time, on April 12, 2024 (the "New Further Extended Expiration Time"). The deadline to validly withdraw tenders of the Old Notes was not extended and expired at 5:00 p.m., New York City Time, on March 11, 2024. The Exchange Offer and Consent Solicitation will expire at the New Further Extended Expiration Time, unless extended or terminated. The New Further Extended Expiration Time is subject to earlier termination, withdrawal or extension by the Issuer in its sole and absolute discretion. All other terms of the tender offer remain unchanged.

The previously announced Early Tender Time lapsed at 5:00 p.m., New York City Time, on March 18, 2024. As such, holders that validly tender and do not validly withdraw their Old Notes prior to the New Further Extended Expiration Time are only eligible to receive $770.00 principal amount of New Notes. The Issuer will pay accrued and unpaid interest to, but excluding, the Settlement Date, which is as soon as practicable after the New Further Extended Expiration Time, in cash, to holders of Old Notes accepted for exchange pursuant to the Exchange Offer and Consent Solicitation.

As of 5:00 p.m., New York City time, on April 9, 2024, approximately $15 million aggregate principal amount of the Old Notes had been validly tendered pursuant to the Exchange Offer and Consent Solicitation and not withdrawn.

Only holders who have duly completed and submitted an eligibility letter (which may be found at www.dfking.com/cumulus) will be authorized to receive the Offering Memorandum and related letter of transmittal (the “Exchange Offer Documents”) and participate in the Exchange Offer and Consent Solicitation. The eligibility letters will include certifications that the holder is either (1) a “qualified institutional buyer” as defined in Rule 144A under the Securities Act of 1933 (the “Securities Act”) or (2) a non-“U.S. person” (as defined in Rule 902 under the Securities Act) located outside of the United States who is (i) not acting for the account or benefit of a U.S. person, (ii) a “non-U.S. qualified offeree” (as defined in the Exchange Offer Documents), and (iii) not a resident in Canada.

Questions or requests for assistance related to the Exchange Offer and Consent Solicitation or for additional copies of the Exchange Offer Documents may be directed to D.F. King & Co., Inc. at (800) 431-9643 (toll free) or (212) 269-5550 (collect) or cumulus@dfking.com (email). You may also contact your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Exchange Offer and Consent Solicitation.

The New Notes have not been and will not be registered under the Securities Act or the securities laws of any state, and may not be offered or sold in the United States absent registration or an exemption from the registration requirements of the Securities Act and applicable state securities laws.

This announcement is not an offer to purchase or sell, a solicitation of an offer to purchase or sell or a solicitation of consents with respect to any securities. The Exchange Offer and Consent Solicitation is being made solely by the Offering Memorandum. The Exchange Offer and Consent Solicitation is not being made to holders of Old Notes in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction.

Forward-looking statements

Certain statements in this release may constitute “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Such statements are statements other than historical fact and relate to our intent, belief or current expectations primarily with respect to our future operating, financial, and strategic performance and our plans and objectives, including with regard to returning capital to shareholders. Any such forward-looking statements are not guarantees of future performance and involve risks, uncertainties and other factors that may cause actual results, performance or achievements to differ from those contained in or implied by the forward-looking statements as a result of various factors. Such factors include, among others, risks and uncertainties related to the Issuer’s ability to consummate the Exchange Offer and Consent Solicitation and/or the Term Loan Exchange Offer, the Company’s ability to generate sufficient cash flows to service debt and other obligations and ability to access capital, including debt or equity, and the Company’s ability to achieve the benefits contemplated by the Exchange Offer and Consent Solicitation and/or the Term Loan Exchange Offer. We are subject to additional risks and uncertainties described in our quarterly and annual reports filed with the Securities and Exchange Commission from time to time, including in the "Risk Factors," and "Management’s Discussion and Analysis of Financial Condition and Results of Operations" sections contained therein. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company’s control, and the unexpected occurrence or failure to occur of any such events or matters could cause our actual results, performance, financial condition or achievements to differ materially from those expressed or implied by such forward-looking statements. Cumulus assumes no responsibility to update any forward-looking statements, which are based upon expectations as of the date hereof, as a result of new information, future events or otherwise.

For further information, please contact:
Cumulus Media Inc.
Investor Relations Department
IR@cumulus.com
404-260-6600

FAQ

What is the ticker symbol for Cumulus Media Inc.?

The ticker symbol for Cumulus Media Inc. is CMLS.

What is the purpose of the Exchange Offer and Consent Solicitation by Cumulus Media Inc.?

The Exchange Offer and Consent Solicitation by Cumulus Media Inc. involves exchanging any and all of the Issuer's outstanding 6.750% Senior Secured First-Lien Notes due 2026 (Old Notes) for new 8.750% Senior Secured First-Lien Notes due 2029 (New Notes).

When is the New Further Extended Expiration Time set for the Exchange Offer and Consent Solicitation?

The New Further Extended Expiration Time for the Exchange Offer and Consent Solicitation is April 12, 2024.

How much principal amount of New Notes are eligible to holders who do not withdraw their Old Notes before the New Further Extended Expiration Time?

Holders who do not withdraw their Old Notes before the New Further Extended Expiration Time are eligible to receive $770.00 principal amount of New Notes.

How can holders participate in the Exchange Offer and Consent Solicitation by Cumulus Media Inc.?

Holders can participate by duly completing and submitting an eligibility letter, which can be found at www.dfking.com/cumulus, to receive the Offering Memorandum and related Exchange Offer Documents.