An agreement has been reached between Merlin Media and Cumulus over two Chicago radio stations Cumulus is now operating under an LMA. Cumulus had agreed to buy WLUP-FM and WKQX-FM for $50 million back in 2017. That all changed when Cumulus filed for bankruptcy last November. Cumulus asked the court to nullify the deal because the stations had lost $8.4 million since 2014 and they weren’t worth $50 million.
Cumulus was paying Merlin a $600,000 per month LMA fee. Cumulus will now only have to pay Merlin up to $15,000 per month per station for what the court calls “reimbursement costs.”
In a bankruptcy court filing, Thursday, Judge Shelley Chapman has agreed to an amended LMA agreement between Cumulus and Merlin. Cumulus will continue to operate WLUP-FM and WKQX-FM through April 30, 2018, with the possibility of extending that agreement to July 31, 2018 and again until October 31, 2018. This is to give Merlin more time to either make plans to take over the stations or find a buyer. Another part of the agreed upon arrangement is that Cumulus will no longer be obligated to purchase the stations.”
Cumulus CEO Mary Berner said, “We’re pleased to reach this mutual agreement, which establishes a clear path forward for these stations and our employees in Chicago following months of negotiations with Merlin. We continue to be interested in permanently acquiring these stations on economic terms that make sense for our business. In the meantime, as we have for the past several years, Cumulus will continue to operate WKQX-FM and WLUP-FM while Merlin seeks a new owner. Importantly, nothing is changing in the near-term. It is business as usual for team members, advertisers, and partners, and we look forward to achieving a favorable outcome for all parties involved.”
