Cumulus Media, already at risk of being delisted on the NASDAQ stock exchange, has been given until April 21 to meet an important deadline.
According to a company filing with the Securities and Exchange Commission, on Thursday Cumulus received notification from NASDAQ that its stockholders’ equity of approximately $6.6 million at the end of 2024 does not meet the market’s minimum of $10 million or its alternative compliance standards.
Shareholder equity is a measure of a company’s net worth. As defined by the website Investopedia, it is equal to the total dollar amount that would be returned to shareholders if the company must be liquidated and all its debts are paid off. It is equal to a company’s total assets minus its total liabilities.
Cumulus is the second-largest commercial U.S. radio company by number of stations and third-largest by revenue, according to BIA Advisory Services.
The letter has no immediate effect on the listing or trading of its stock, but the company was given 45 days to lay out its plan to achieve and sustain compliance.
If NASDAQ accepts the plan, the market may grant an extension of up to 180 days. If it does not, NASDAQ will notify the company that its Class A common stock will be subject to delisting, which Cumulus could then appeal.
“The company intends to submit the Compliance Plan to NASDAQ, within the required time period,” Cumulus told the SEC. “The company is continuing to evaluate potential options to resolve the deficiency and regain compliance … including the possibility of applying to transfer to the NASDAQ Capital Market.” The latter market is for companies that have relatively lower market capitalizations, according to Investopedia.
The company stock closed on Friday at 52 cents. Its high in the last five years was in mid-2022 at around $15. The company emerged from a bankruptcy restructuring in 2018.
Radio World requested comment from Cumulus and will report any reply.
