In a Tuesday night SEC filing, Beasley Media Group detailed for shareholders exactly how much this $240 million 21-station merger with Greater Media will cost them, both in long-term debt and short-term fees.
As of June 30, 2016, Beasley had long-term debt of $83.0 million. When the deal closes, Beasley expects its long-term debt to increase to $265.0 million and states, “This substantial amount of long-term debt could have an impact on our current stockholders.” In addition to the debt, there are substantial costs associated with a deal of this size…
Beasley states in the filing that the total transaction costs to consummate the Merger are estimated to be approximately $11.7 million including estimated debt issuance costs of $10.6 million, which do not include any costs to be borne by Greater Media. That amount can change. “It is expected that our costs related to legal and regulatory compliance may increase substantially, at least in the near term, because Greater Media has not previously been required to comply with the reporting, internal control, public disclosure and similar legal and regulatory compliance obligations applicable to publicly traded companies. Although we expect that the elimination of duplicative costs, as well as the realization of other efficiencies related to the integration of the businesses, may offset incremental transaction and Merger-related costs over time, this net benefit may not be achieved in the near term or at all.”
ANSWER: Too much. Radio is as dead as disco.