Who said radio consolidation was dead? Cumulus Media, the second largest radio owner based on station count, announced Wednesday (April 7) it formed a strategic partnership with Crestview Partners, a New York-based private equity firm, to buy radio companies. The partnership, called Cumulus Radio Investors could target acquisitions totaling in excess of $1 billion.
Under the terms of the partnership, Crestview will lead the investor group and Cumulus Media would run the stations under a management services agreement, providing all the management, financial, operational and corporate services.
The financial model was the same one Cumulus Media, as part of Cumulus Media Partners, used in 2006 to purchase Susquehanna Radio for $1.2 billion.
The time is ripe for acquisitions in the radio industry, which is beginning to recover following a brutal recession. Last year, radio acquisitions totaled only $400 million, per BIA/Kelsey.
"We will be deliberate and disciplined in our investment approach, but we are prepared to move quickly to capitalize on the strategic investment opportunities that we believe are available today," said Lew Dickey, president and CEO of Cumulus.