Possible Radio Station Company Takeover Sends Stock Soaring

WASHINGTON — The stock price for Cumulus Media, a company with 406 radio stations across the United States, shot up about 40% Thursday afternoon to just over $14 a share for a 52-week high.

The increased public interest came just after Reuters reported a consortium of investors led by Connoisseur Media CEO Jeff Warshaw is interested in buying the company for about $1.2 billion, including debt. Warshaw’s group would purchase the company for somewhere between $15 to $17 per share, according to the report.

A spokesperson for Cumulus confirmed the company did receive “a letter with respect to an unsolicited, non-binding, highly conditional indication of interest. Consistent with its fiduciary duties and in consultation with its financial and legal advisors, the Cumulus Board of Directors is reviewing the letter.”

This bid to acquire the radio station company comes after it had a successful year bouncing back from the COVID-19 pandemic. The company increased its full-year net income to $17.3 million in 2021 versus its net loss of $59.7 million in 2020, according to a statement from the company.

“2021 was a year of tremendous progress and accomplishment for Cumulus,” Mary Berner, president and CEO of Cumulus Media, said in a statement. “We not only achieved meaningful revenue growth in core radio, delivered substantial growth in digital, and greatly improved our operating leverage through material fixed cost reductions, but we also further and significantly de-levered our balance sheet, and executed many initiatives which bolstered our position as a true audio-first media company.

“As we carry this momentum into 2022, we continue to see significant upside with multiple pathways to enhance shareholder value,” Berner added.

This is a potential homecoming of sorts for Warshaw. He originally founded Connoisseur Communications Partners LP — a 39-station group, which he sold to Cumulus Broadcasting — while he was a student at the University of Pennsylvania’s Wharton School of Business in 1993, according to his company’s website.

Warshaw made that sale for $258 million in 2000 to the subsidiary of Cumulus Media.

In 2004 he founded his current company, Connoisseur Media, which operates 13 radio stations in four different markets including Frederick, Maryland, and three New York City suburbs.

Madeline can be reached at maddie@thewellnews.com