Cumulus Media Announces Extension of Early Tender Time in Exchange Offer and Consent Solicitation Relating to 6.750% Senior Secured First-Lien Notes due 2026
Cumulus Media Inc. announces extension of Early Tender Time in Exchange Offer and Consent Solicitation for Senior Secured First-Lien Notes. The Issuer offers to exchange Old Notes for New Notes, with an Early Tender Premium. The Exchange Offer and Consent Solicitation will expire on March 26, 2024.
The extension of the Early Tender Time for Cumulus Media Inc.'s Exchange Offer and Consent Solicitation represents a tactical move within the company's debt management strategy. The shift from 6.750% to 8.750% interest rates on the new Senior Secured First-Lien Notes indicates a significant increase in the cost of debt for Cumulus. This maneuver suggests an attempt to improve the company's liquidity or to extend the maturity of its debt profile during a period that might involve higher market volatility or credit risk apprehension.
The Total Consideration, inclusive of the Early Tender Premium, is designed to incentivize bondholders to participate before the new deadline. This could be indicative of Cumulus's urgency to restructure its debt amidst current market conditions. The financial implications of this move are twofold: while it may alleviate short-term liquidity concerns, it increases long-term interest obligations. Stakeholders, including investors and analysts, should closely monitor the uptake of this offer as it may signal market confidence in Cumulus's financial stability and future performance.
Examining the impact of the exchange offer on Cumulus Media Inc. from a market perspective, it is essential to consider the broader industry context. The media industry is undergoing significant transformation, with digital disruption and changing consumer behavior affecting traditional revenue streams. Cumulus's decision to extend the Early Tender Time could reflect a proactive approach to managing financial headwinds in a turbulent industry.
Investors should be aware of the potential for an increase in leverage, which could affect the company's credit rating and stock price. The market's reception of the new notes, as well as the participation rate in the exchange offer, will provide valuable insights into the company's perceived creditworthiness and the attractiveness of its debt instruments compared to industry peers. An unfavorable response might suggest skepticism about the company's long-term prospects or the media sector's financial health in general.
The legal implications of Cumulus Media Inc.'s exchange offer are noteworthy, particularly given the regulatory environment surrounding securities. The offer is limited to 'qualified institutional buyers' and non-'U.S. persons', which is a strategic move to target a specific investor base while adhering to the Securities Act of 1933. This targeting is likely a reflection of the company's need to navigate complex securities regulations while attempting to restructure its debt.
The exclusion of general registration under the Securities Act for the new notes implies that the company is utilizing exemptions, which could limit the liquidity of these securities. Investors should be aware of the legal constraints associated with these securities, as they may not be as freely tradable as registered securities. This could affect their marketability and, by extension, the success of the exchange offer.
03/12/2024 - 08:30 AM
ATLANTA, March 12, 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 extended the Early Tender 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 extending the previously announced Early Tender Time, which was 5:00 p.m., New York City Time, on March 11, 2024, to 5:00 p.m., New York City Time, on March 18, 2024 (the "New Early Tender 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 5:00 p.m., New York City Time, on March 26, 2024 (the “Expiration Time”), unless extended or terminated. The New Early Tender Time and Expiration Time are both 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.
Accordingly, holders that validly tender and do not validly withdraw their Old Notes at or prior to the New Early Tender Time will be eligible to receive $800.00 principal amount of New Notes per $1,000 principal amount of Old Notes tendered (the “Total Consideration”), which includes an early tender premium of $30.00 in principal amount of New Notes per $1,000 principal amount of Old Notes tendered (the “Early Tender Premium”). Holders that validly tender and do not validly withdraw their Old Notes after the New Early Tender Time and at or prior to the Expiration Time will not be eligible to receive the Early Tender Premium and will only be 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 Expiration Time, in cash, to holders of Old Notes accepted for exchange pursuant to the Exchange Offer and Consent Solicitation.
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.
What is Cumulus Media Inc. extending in the Exchange Offer and Consent Solicitation?
Cumulus Media Inc. is extending the Early Tender Time in the Exchange Offer and Consent Solicitation for Senior Secured First-Lien Notes.
What are the terms of the exchange of Old Notes for New Notes?
Holders that tender Old Notes at or prior to the New Early Tender Time will receive $800.00 principal amount of New Notes per $1,000 principal amount of Old Notes, including an Early Tender Premium.
When will the Exchange Offer and Consent Solicitation expire?
The Exchange Offer and Consent Solicitation will expire at 5:00 p.m., New York City Time, on March 26, 2024.
How can holders participate in the Exchange Offer and Consent Solicitation?
Holders must complete and submit an eligibility letter to receive the Offering Memorandum and related Exchange Offer Documents.
Are the New Notes registered under the Securities Act?
The New Notes have not been and will not be registered under the Securities Act or the securities laws of any state.
