Published on Friday, 02 September 2011 08:38
Merlin Media LLC is the official owner and operator of Chicago's WLUP-FM and WWWN-FM (formerly WKQX-FM) as of yesterday afternoon. The transaction announced back on June 21st
, passed all federal regulatory approvals and other customary conditions, and came to a successful close.
The sale of WLUP-FM and WWWN-FM (formerly WKQX-FM), as well as New York's WEMP-FM (formerly WRXP-FM) brought the financially struggling previous owner Emmis Communications approximately $120 million in cash. Much of the cash will be used to pay down debts owed to an Emmis senior creditor by almost 40%, putting them in a much stronger financial state.
In addition to the cash transaction, Emmis Communications becomes a minority owner in Merlin Media, LLC, with 20.6% of the common equity interests and $28.7 million of preferred equity.
Jeff Smulyan, Chairman & CEO of Emmis, said in a statement
: "While it is difficult to part with these stations, we are pleased to remain involved as an investor in Merlin Media. The proceeds of the sale allow us to significantly delever the company and evaluate a variety of exciting opportunities for the next era of growth at Emmis."
The successful close of the Emmis/Merlin sale is not expected to have any immediate impact on the stations, since Merlin Media already had been operating and reshaping the stations for weeks. On July 15th
, Emmis Communications gave a Local Marketing Agreement (LMA) to Merlin Media to go ahead and take control of the three stations prior to the close of the transaction. This resulted in two out of the three stations being flipped from rock formats to a new type of news format, the two new news stations also gaining new call letters.
With the Merlin Media era now officially under way, rumors continue to swirl about the company expanding its empire beyond these three radio stations. Though nothing is confirmed, it is said that the company has its eyes set on FM stations in Los Angeles, CA, Philadelphia, PA, and Annapolis, MD already, with some Florida stations on its radar, too. Additionally, just one month ago, the Chicago-based private equity firm, GTCR LLC, who also is the primary financial power behind the Merlin Media LLC, agreed to purchase the international radio traffic company Global Traffic Network
, with insider talk of bringing it into America to work with Merlin Media stations in the future, and then others.