Connoisseur CEO Jeff Warshaw wants to grow his radio company. First he made an offer to buy Cumulus but was rebuffed on two occasions. This week we learned he made a run at Saga where he was also shot down.
In an SEC filing Saga disclosed that its board had received an unsolicited and non-binding conditional indication of interest to buy the company. Two different scenarios were presented to the board.
The first structure was a cash buyout offer in the range of $30 to $33 per share. The second structure was a merger with the offeror providing the indication of interest in which Saga shareholders would receive $12.47 per share in cash at closing and would own 83.1% of the new combined entity, which would then assume the offeror’s existing debt.
Radio Ink sources confirmed the offer was made buy Warshaw.
The Saga board rejected both offer.
The SEC filing stated that it was the judgement of the Saga board that “the offeror did not provide sufficient evidence of ability to obtain the required financing under either structure. In either case, based on the structure and highly conditional nature of the offer, the result would have been a takeover of the company by a smaller broadcaster, to be soon followed by a significant leveraging of the company’s (or its successor’s) cash and other assets to finance the transaction through borrowing and issuing preferred equity.”
The filing went on to say that the board will continue to formally review and evaluate all opportunities to enhance shareholder value, including through the new variable dividend policy as well as future acquisitions of additional broadcast properties.
