Once its tower sites sell in Washington and Los Angeles, Cumulus Media could wipe out about $200 million in debt.
So said company Chairman/President/CEO Lew Dickey to Wall Street analysts as the company reported its earnings yesterday. Cumulus has a contract to sell the KABC(AM) tower site in L.A. for $125 million. Cumulus acquired the site as part of its Citadel purchase in 2011.
That parcel needs to be rezoned, and Dickey expects the deal to close at the end of this year or “very early” in 2016, “depending on when we receive zoning approvals,” according to a transcript of the earnings call from Seeking Alpha.
Cumulus has a contract with a developer that is in the midst of multiple projects in the Los Angeles area, according to Dickey.
We recently reported that Cumulus plans to sell the tower site for WMAL(AM), Washington. CBRE Group Inc. is accepting bids for the Bethesda, Md., site until March 12. Many of those offers are coming from developers who want to build luxury homes on the 75-acre tract. The Montgomery County, Md., government is also considering making an offer, reports the Montgomery Sentinel.
Dickey tells analysts there’s been interest in the WMAL site from “more than 100 parties” and Cumulus anticipates finalizing a sale towards the end of the year; Unlike Los Angeles, that site does not need to be rezoned.
“We believe the proceeds of this sale and the highly successful L.A. transaction will enable us to repay another $200 million of debt shortly after both transactions close,” stated Dickey, according to the transcript.
The company reported some $2.5 billion in total debt.