Cumulus Media deal is off; investor group to pay $15 million termination fee

By Lisa Kerner

Charlotte, N.C., May 12 - Cumulus Media Inc. announced it agreed to terminate the $11.75-per-share July 23, 2007 merger agreement with an investor group led by the company's chairman, Lewis Dickey.

The investor group, which includes an affiliate of Merrill Lynch Global Private Equity, was not able to come to terms to move forward with the $1.3 billion deal, according to a Cumulus news release.

As a result, the group will pay Cumulus a $15 million termination fee.

In addition, the terms of the previously announced amendment to the company's existing credit agreement will not take effect.

The transaction was expected to be financed through a combination of equity contributed by Dickey; his brother John W. Dickey, who is the company's executive vice president and co-chief operating officer; other family members; and Merrill Lynch Global Private Equity. Debt financing had been committed by Merrill Lynch Capital Corp., a prior news release said.

Cumulus said its board of directors plans to explore the possible implementation of a new stock repurchase plan, providing liquidity opportunities to its stockholders.

"Our business remains fundamentally sound and we intend to continue to operate it aggressively and explore opportunities to create and deliver value for our shareholders," Lewis Dickey said in the release.

Cumulus operates 344 radio stations in the United States. The company is based in Atlanta.

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