Cumulus Media, Inc. is an American broadcasting company and is the
third largest owner and operator of AM and FM radio stations in the
United States behind
Entercom and iHeartMedia, Inc. Cumulus lists
ownership of 446 stations in 90 markets, as of July 1, 2017. It
also owns Westwood One. Its headquarters are located in Atlanta,
Georgia. Its subsidiaries include Cumulus Broadcasting LLC, Cumulus
Licensing LLC and Broadcast Software International Inc.
1 Company history
1.1 The Early Years
1.2 A Public Company - Accelerating Acquisition Pace
1.3 Challenges in 2000
1.5 Changing of the Guard
1.6 Chapter 11 bankruptcy
2 Chairman, President and Chief Executive Officer
2.1 Acquisition of
Citadel Broadcasting and Dial Global
2.2 Launch of Nash,
CNN partnership, and Rdio/iHeart
3 FCC actions
5 See also
7 External links
The Early Years
The company was started in August 1998 by radio consultant Lewis
Dickey Jr. and media and technology entrepreneur Richard Weening. The
Telecommunications Act of 1996, among other things removed
restrictions on the number of radio stations a single owner could
control in a market and overall. Dickey, then a nationally known radio
programming consultant, was acting as a consultant to a small radio
group in which Weening had a personal investment. Dickey and Weening
joined forces around Dickey's idea to acquire and operate radio
stations in mid-size markets where giant Clear Channel was not
focusing. Dickey was the radio expert and Weening was the corporate
finance and start-up CEO. Dickey was President of Stratford Research
his radio consulting firm  and also president of his family
company, Midwestern Broadcasting with two stations in Toledo, Ohio
which would later be acquired by Cumulus. Weening had successful
experience as a start-up CEO in book and magazine publishing, online
services and enterprise software systems. He was then CEO of QUAESTUS
& Co., Inc., a private equity firm specializing in media and
technology start-ups. A student of classics, Weening came up with the
name Cumulus  which means "accumulation" in Latin and best
described Dickey and Weening's plan to acquire stations in 50 or more
markets. QUAESTUS provided the seed capital to make the first station
acquisitions as a model for the Cumulus strategy.
The next significant milestone was a $50 million investment from
closely watched and highly respected State of Wisconsin Investment
Board (SWIB) [[]] previously an investor in Weening's magazine
publishing company. Full scale operations started on May 22, 1997.
Weening assumed the role of Executive Chairman focusing on
acquisitions deal structuring, corporate finance and internet from
headquarters in Milwaukee, Wisconsin. Dickey selected stations to buy
and oversaw radio programming, operations and strategy as Executive
Vice Chairman. Dickey brought in highly regarded radio operator
William Bungeroth to serve as President of Cumulus broadcasting from
new offices in Chicago's Hancock Center. Bungeroth had a reputation as
an advertising sales leader. He would oversee market level tactical
execution including the integration of newly acquired stations into
market operating units. John Dickey, Lew's brother and himself an
experienced programming consultant would oversee station
SWIB's investment was soon followed by another $50 million from
Northwestern Mutual Life Insurance Company
Northwestern Mutual Life Insurance Company and $25
million from NationsBank Capital Corporation. Financial backing
secured, Dickey and Weening set out to acquire radio stations working
hard to stay as much "under the radar" as possible not wishing to
attract notice or competition. In the first 12 months Cumulus acquired
over 100 stations in 31 markets. Almost as soon as the acquisition
spree started it was clear the Company would require more than a
billion dollars for acquisitions in its sights and plans were laid for
a public offering.
The Cumulus strategy as articulated in public filings was to acquire
multiple stations in a city or market, consolidate them physically to
share a common infrastructure to reduce operating expenses but enrich
programming giving each stations a unique music format, live
programming, brand and target audience. The central idea was to create
a cluster of radio stations that could compete with newspapers by
offering advertisers a range of target demographic choices comparable
to the range of content sections in print. At the time, newspaper
display and classified advertising claimed the largest share of local
advertising dollars. By offering a range of audiences like newspapers.
Cumulus could gain more share of the local advertising dollar than the
individual stations could garner on their own. In addition, acquiring
the top performer stations in the market as part of the operating
cluster would get more national advertising. The market focus would be
those deemed to offer substantial growth opportunities and the station
focus was leader station in the market and stations well position for
significant growth 
A Public Company - Accelerating Acquisition Pace
Cumulus became a public company on June 26, 1998 raising $400 million
selling 7.6 million common shares at $14.00, $125 million in Preferred
Stock and $160 million in Senior Subordinated Bonds. At that time
Cumulus owned or was committed to buy 176 stations - 124 FM and 52 AM
in 34 US markets. In its first 17 months, Cumulus acquired 207
stations, creating the first mid size radio conglomerate.
Following the company's IPO, its stock fell from $14 to $8 on October
2, 1998 then began a climb to close 1999 at $50.75 Some radio
executives familiar with small markets thought that Cumulus was
overpaying to buy top stations in markets that did not have a great
For 1998 Cumulus reported revenue of $98.8 million, with broadcast
cash flow of $26.6 million. Its cash-flow margin reached 27 percent.
For 1999 Cumulus reported $180 million in revenue and $46.7 million
broadcast cash flow.
In November 19 the Company sold an additional 10 million shares at
$24.93 raising $250 million. Acquisitions continued at an
accelerating pace. At this point the Company owned or operated pending
closing 246 stations in 45 US markets. In 2 years and 6 months the
Company became the 2nd largest US broadcasting group in terms of
stations operated. In this period, the Company raised a staggering
$1.3 billion considering sales of common and preferred stock shares,
senior bank lines of credit and senior subordinated debt or junk bonds
which when issued were rated CCC+.
The stock market acknowledged the remarkable growth with a remarkable
share price that levitated to a high of $51.00 at December 31, 1999.
Challenges in 2000
There was no .com in the Cumulus name but it was a part-time
participant in the euphoria of the dot-com bubble and impacted by the
hysteria that followed its burst. The reasons included very rapid
growth and skyrocketing share price which in the euphoria period fed
on itself. The hysteria which followed was driven by the absence of
earnings and rumours which suggested the rapid growth might be a
Here is what happened between January 10 and March 31. A perfect storm
of events drove the Company's share price from $50 to $13 between
January 1 and March 17 when over 30 million shares traded hands.
Driving the decline was persistent rumours of possible accounting
irregularities in the rapidly assembled radio group. On January 14
respected Wall Street analyst Frank Bodenchak advised institutional
clients that Cumulus may miss his estimates for Q4 1999 and the year.
A combination of the possible earnings miss and the rumours of
accounting problems created a significant loss of investor confidence.
On March 17, Cumulus reported a loss of $0.20 per share vs $0.15 per
share expectation. Broadcast cash flow was $12.3 million vs
estimates around $17 million. In addition the Company reported that
company CFO Rick Bonick had left earlier in January. It was not
officially announced a fact that
CNN Money says "roiled the already
active rumour mill about accounting irregularities. The Company also
reported it would restate quarterly revenues in 1999 as some markets
did not comply with Cumulus' revenue recognition policies and booked
some advertising contracts for their full value rather than
recognizing revenue as the ads aired. As a result, class-action
lawsuits were filed against Cumulus charging the company with
artificially inflating revenue and profit in 1999.
PricewaterhouseCoopers, the company's auditors resigned in April
citing material weaknesses in the Cumulus' financial controls
arising from the possible revenue restatements.
Meanwhile, Dickey had taken over day-to-day station operations from
Bungeroth who resigned in mid January.
During this same period Weening got into a dispute with the SEC over
his proposal to reverse some of his and Dickey's 1999 compensation to
help offset the earnings miss. While the proposal was never
implemented, the SEC maintained it would have amounted to earnings
management and was therefore an infraction. Weening finally agreed to
pay a fine of $75,000 without conceding wrongdoing to settle the
matter in 2003.
As the dust began to settle in April 2000 the company issued revised
annual 10K reports for 1998 and 1999 that showed minor variations in
quarterly revenue and adjusted net loss for 1999 from $20.8 million to
$13.6 million and net loss for 1998 was restated from $13.7 million to
$8 million, after the company found a $4.9 million tax benefit that
had been under-reported. The restatement as it turns out had no
material impact on the financials but in the context of the dot-com
bust hysteria rumours of accounting irregularities drove a significant
decrease in share price which threatened the Company's ability to
finance pending acquisitions.
Since November 1998 the Company had been developing an internet
platform for classified employment advertising. The new system would
operate in tandem with the radio station cluster in each market and
offer employers the chance to post available positions on the web and
promote their company and the position on the radio stations. At the
time of the dot-com bust the system was in beta test in two markets.
One of the short-lived but important impacts of the dot-com bubble
burst was a loss of confidence that the promise of the internet would
ever happen. Many professional radio people like Dickey were skeptical
and believed the best course for Cumulus was to focus on the radio
strategy and drop the internet projects. Weening who had started a
Silicon Valley e-commerce software company in the early 90's had
conceived and was overseeing development of the employment
platform. Weening advocated for continuance of the project as a
key potential source of revenue with a service that would be unique
among radio companies. Ultimately, the board backed Dickey not Weening
Internet project was scrapped.
Changing of the Guard
According interviews with two former members of the Cumulus board, Lew
Dickey and his brother John convinced the board to let them run the
Company. Dickey, whose family had just sold an Atlanta station for a
reported $250 million, offered to invest in Cumulus if needed to close
pending acquisitions. The board was concerned about the restatement of
revenues and the shareholder lawsuits. This is consistent with reports
in a radio industry newsletter  which reported that it was a
widely held belief in the
Radio industry was that the Dickey brothers
orchestrated events that lead to the board's decision not to back the
Internet project, placing Dickey at the helm of Cumulus, moving the
Cumulus headquarters from Milwaukee to Atlanta and to Weening's
ultimate resignation as an employee and director in January
2001. According to public filings Weening, QUAESTUS management
company and other Weening related interests sold their interests in
Cumulus a year later in May 2002 at prices ranging from $17 to $21.50
per share not The $55 high but considerably higher than share prices
after their sale.
The new CEO of Cumulus Media, as of September 2015 is Mary G
In April 2016,
Radio Network filed a lawsuit against Cumulus
Media and associated defendants, alleging "antitrust violations,
unfair competition, breach of contract and breach of fiduciary duty,
among other claims", similar to a lawsuit launched in 2012 and dropped
in 2014 by the same plaintiff. In June 2016,
Cumulus Media and
Westwood One moved to have the new suit dismissed.
In June 2016,
Cumulus Media announced the resignation of its Executive
Vice President, Treasurer and Chief Financial Officer, Joseph P.
Hannan, to "pursue other interests" after six years with the company,
to be replaced by John F. Abbot. In October 2016, it was announced
Hannan had taken the role of Chief Financial Officer at programmatic
advertising company, Social Reality, Inc. [NASDAQ: SRAX]. Per SEC
filings, Hannan would also "assist the company for several months to
ensure a smooth transition".
Chapter 11 bankruptcy
On November 29, 2017, Cumulus filed for
Chapter 11 bankruptcy
Chapter 11 bankruptcy as part
of a restructuring of the company.
Chairman, President and Chief Executive Officer
Lew Dickey took full charge. By May 2002 the share price recovered to
above the IPO price to a short-lived high of $22 on May 31, 2002.
Dickey garnered some strong partners in the form of
Bain Capital and
Crestview partners who helped finance a series of ambitious
acquisitions and partnerships which were creative, made Cumulus a
significantly larger company but these acquisitions and Cumulus itself
have struggled in the face of slow to no radio ad growth. (another
researcher is working on this section)
In 2006, Cumulus acquired control of Susquehanna Radio, with the
backing of 3 venture capital firms (
Bain Capital Partners LLC, The
Blackstone Group and Thomas H. Lee Partners, L.P.) for a price of $1.2
Billion. The 33 Susquehanna stations were privately held in a separate
Cumulus Media Partners, LLC (commonly referred to
as CMP on the company's quarterly earnings calls) that was the subject
of an equity-for-debt swap in May 2009 in an attempt to avoid
defaulting on the terms of the CMP lending agreement. While Cumulus
operated the CMP stations, they initially held only a minor ownership
interest in them. On January 31, 2011, Cumulus announced a deal to
acquire the remaining ownership of CMP from its equity partners in a
stock transaction valued at approximately $740 million that is closed
in August 2011. As a result of the CMP acquisition, Cumulus now
owns a limited-partnership interest in San Francisco Baseball
Associates LP, the owner of the
San Francisco Giants
San Francisco Giants baseball
In July 2010, Cumulus publicly announced formation of a similar
venture with Crestview Partners to acquire up to $1 billion of
additional radio assets.
In July 2007, the company announced its intention to "go private",
however on May 11, 2008, the company announced it was unable to come
to terms with the parties involved and the merger/acquisition
agreement was terminated.
Like most major American radio station owners, Cumulus has been forced
to write down the value of its radio station licenses, resulting in
large non-cash losses - $498.9 million in 2008, $230.6 million in
2007, and $63.4 million in 2006.
The company's stock, priced over $56 in 1999, then over $22 in
2004, was as low as $0.45 per share toward the end of 2008.
Citadel Broadcasting and Dial Global
Starting in June 2010, Cumulus made multiple unsuccessful offers to
Citadel Broadcasting after its emergence from bankruptcy.
In February 2011, Cumulus was again said to be in "exclusive
negotiations" to acquire Citadel for $2.5 billion paid to Citadel
shareholders, according to CNBC. Some Citadel shareholders were said
to have been pushing the board to consider a sale. On March 10,
Citadel Broadcasting stations announced via email that Cumulus
had purchased Citadel Broadcasting. Citadel was made up of 225 radio
stations in over 50 markets, as well as Citadel Media, one of the
largest radio networks in the United States. The deal was finalized on
September 16, 2011, after acceptance by the FCC and Citadel's
shareholders. As part of the deal,
Cumulus Media will have to
place 14 stations into a separate trust to comply with ownership
limits. Following the acquisition, in an effort to focus on larger
markets, Cumulus reached a deal with
Townsquare Media to swap 65 radio
stations in 13 markets, with the majority of the 65 stations being
sold to Townsquare.
On August 29, 2013, it was reported by
The Wall Street Journal
The Wall Street Journal that
Cumulus would purchase the syndicator
Dial Global for $260 million. To
fund the sale, Cumulus, sold 53 more stations to
Townsquare Media for
$238 million, in markets such as Danbury, CT, Rockford, IL, Cedar
Quad Cities IA/IL, Waterloo, IA, Portland, ME, Battle
Creek, MI, Kalamazoo, MI, Lansing, MI, Faribault, MN, Rochester, MN,
and Portsmouth, NH. Additionally,
Townsquare Media acquired Peak
Broadcasting, and Cumulus swapped 15 more stations in Dubuque, IA and
Poughkeepsie, NY in exchange for Peak Broadcasting’s Fresno
cluster. The sale to Cumulus was completed on November 14,
Launch of Nash,
CNN partnership, and Rdio/iHeartRadio
On January 11, 2013, after acquiring the station from Family Radio,
Cumulus re-launched WFME in New York City as a country music station
under its new
Nash FM brand. Nash was designed to serve as an umbrella
brand for all country music-related content across the company's
properties, including radio, digital, and live events such as the
"Nash Bash". All country stations owned by Cumulus would either be
branded as Nash FM, or be strongly cross-promoted as part of the Nash
family of properties.
In July 2014, Cumulus announced that it would end its partnership with
ABC News Radio, and enter into a new partnership with
CNN to syndicate
news content for its stations through
Westwood One beginning in 2015.
The network will provide its content on a white label basis, allowing
individual stations to use their own brands for the content. In turn,
ABC announced that it would take the syndication of its radio content
in-house, with distribution handled by Skyview Networks.
On September 15, 2013, Cumulus announced that it had entered into a
partnership with music streaming service Rdio; Cumulus took a stake in
Rdio, and provided the company with access to its advertising sales
team for a freemium tier, the ability to offer Cumulus radio stations
Rdio service, and $75 million in marketing on Cumulus stations
over five years. The stations launched on
Rdio in August 2015; prior
to the deal, Cumulus partnered with the competing iHeartRadio
service. This only lasted a few months however, as Rdio
entered bankruptcy in November 2015 and sold most of their assets to
Rdio ending operations the next month. Cumulus maintains
their stations on iHeart
Radio to the present day.
On December 30, 2008,
Cumulus Media was issued a $14,000 Notice of
Apparent Liability by the
Federal Communications Commission
Federal Communications Commission related to
the stations in the Macon, Georgia, cluster. The FCC says Cumulus
failed to comply with its record-keeping requirements and its Equal
Employment Opportunity rules on information on recruitment sources.
Cumulus, along with two other companies, had 30 days to pay or file a
statement asking for reduction or cancellation of the forfeitures.
On March 17, 2000, the company was forced to restate revenue and
broadcast cash flow for three quarters of 1999 after discovering that
some of its sales force had prematurely booked revenue to meet sales
goals. On November 8, 2005, Company decided to amend and restate
its results for the second quarter of 2005.
List of radio stations owned by Cumulus Media
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Cumulus Media Inc.
CBS Sports Radio*
Westwood One (see navpage)
Nash Country Weekly
Broadcast Software International
San Francisco Giants
San Francisco Giants (minority interest in LP)
Cumulus Media Networks
1 = Owned by iHeartMedia; operated by Cumulus under an LMA.
2 = Co-owned with Champlin Broadcasting under an LMA.
3 = Operated by the
Mohegan Sun under an LMA.
~ = Owned by The Walt Disney Company; operated by Cumulus under an
* = Owned by CBS Corporation, op