Exclusive: What About Cumulus’ Debt?


Now that we’ve heard from Cumulus CEO Mary Berner that, operationally, the company has turned the corner, what about the debt issue? That was another topic we discussed with the two-year Cumulus CEO in our interview that will appear in the October 9 issue of Radio Ink Magazine. Cumulus has about $2 billion debt. The company has repeatedly reported to Wall Street that it is “exploring all available options with a focus on maintaining the momentum of the turnaround effort.” Here’s what Berner had to say to us about that debt.

Radio Ink: How are you feeling about the Cumulus debt issue?
Berner: We continue to look at options. It doesn’t affect our employees, it doesn’t affect our strategy, or what we do day-to-day, or our optimism about the fact we have turned the corner. It’s something, however, that we need to fix, and we need to do it with minimal disruption, and so that is what we are doing.

Radio Ink: Do you feel confident it will be fixed in time?
Berner: Not sure what you mean by “in time,” but yes, it will be fixed.

Radio Ink: Is there any chance Cumulus will sell off any stations in the next six months to a year?
Berner: That is not our plan. Is there any chance? There’s always a chance, but honestly, that’s not in the cards right now.

Radio Ink: Is there enough time to turn around the company?
Berner: Yes. We just posted a growth for the first time in three years. As I said, we fixed the fundamentals, we have built a solid platform for growth, and we have positive momentum. We are doing this in a down market. We have new products that will continue to support that momentum.

The key challenges are no longer operational. The key challenge is that we have a balance sheet with too much debt. Once that is fixed, we will have a solid company, because operationally the company is in a good place. We turned the corner. That doesn’t mean smooth sailing forever, but it means we were able to change what was a downward trajectory (and the momentum of that), which is a milestone.

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  1. Doubters are good. In a very short period of time Mary has cleaned up Dickey’s absolute mess! As I’m writing, his slimy, around the corner picture is looking at me. (In this Issue: Sept 4, 2017). He is coming around the corner again. Keep him away from radio. Maybe Trump can use him! I digress. Now back to Mary. I believe she is helping radio, cumulus and its employees, and will continue doing so. The hanging chad (Debt) will get addressed soon. You can bet Crestview has a HUGE say here (major shareholder). I expect some type of merger and/or the selling of radio stations to get the debt inline. A decade of Dickey and two years of Mary is where we stand. I see Mary having this mess cleared up, with a little pain, within a year and a half.

  2. Mary may be a whizz-bang corporate operator.
    She can also claim distance between herself and the thugs who have been ruining radio.
    Her own bailout (in case of an impending crash) is secure.
    My questions are: Has Mary had the time or the inclination to become aware of how radio has been working?
    And, Has Mary considered any of the alternative approaches to operating an effective radio business that are, indeed, available?
    As an aside: Where are the reports from deliriously happy Cumulus employees who are now experiencing having “turned the corner”?

  3. Everybody note: The key phrase is “turned the corner.” Berner thinks if she says it enough we’ll all be hypnotized and think she’s actually saving a sinking ship. “Operationally,” things might be smoother than NASA. But Berner, have two billion dollars of debt! You think you’ll just wiggle out of that thanks to your unique genius? The truth is, you’ve made some good operational fixes, sure, but now the real problem has to be addressed and you’ve hit the wall. Here’s two things that most people in radio already know — and I suspect you do too: 1. Letting big corporations buy up bucketloads of radio stations and “run” them, is like putting pythons in charge of the chicken coop; 2. The absolutely outrageous greed-debt accumulated by Cumulus and iHeart is going to end up hurting a lot of people. The writing is well and truly on the wall. That kind of money isn’t just going to get written off. Radio Ink: how about interviewing some stockbrokers about Cumulus and see if they use the term “turned the corner” even once. Yes, a lot of people will end up getting hurt. But the likes of Berner will skate away with fat departure packages after being paid a fortune for showing absolutely no moral obligation to radio and the real people in it.


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