INDIANAPOLIS, July 1, 2019 /PRNewswire/ -- Emmis Communications
Corporation (Nasdaq: EMMS) today announced that it has signed an
agreement to form a new public company, Mediaco Holding, with
New York investment firm Standard
General. Mediaco Holding will purchase from Emmis two of its
New York radio properties, WBLS-FM
and WQHT-FM (HOT 97). Closing of the transaction is subject
to FCC approval and other customary closing conditions, and is
expected to occur later this year.
As a result of the transaction, Emmis will receive $91.5 million in cash, a $5 million note receivable, and 23.72% of the
common equity of Mediaco. Emmis will distribute this common
equity of Mediaco pro rata to its shareholders in a taxable
dividend. Mediaco will be a public company expected to be
listed on NASDAQ, and Emmis will remain a separate public company,
as well.
Emmis will remain active in the management of WBLS and HOT 97
and provide certain corporate services to Mediaco pursuant to a
management agreement between the parties. Jeff Smulyan will be the Chief Executive Officer
of Mediaco and will continue to serve as Chairman and Chief
Executive Officer of Emmis, which will remain a public
company. Standard General will appoint a majority of the
board of directors of Mediaco and Soohyung
Kim, Chief Executive Officer, Managing Partner and Chief
Investment Officer of Standard General L.P., will be Chairman of
Mediaco.
"This is a landmark day in the forty year history of Emmis,"
said Jeff Smulyan. "We look
forward to continuing to manage two of the world's most iconic
radio brands in HOT 97 and WBLS and employ our award-winning
New York team as we partner with
Soo Kim and Standard General to form
a new public company to invest in media opportunities. The
transaction provides Emmis significant capital to aggressively
pursue new business opportunities that align with our
entrepreneurial spirit and management skills. We are also
excited to work with Soo and Standard General to grow Mediaco
Holding. We have already been evaluating great investment
opportunities and I'm incredibly excited about the future. Today is
a great day for the future of Emmis."
"Our team is excited about partnering with Jeff and the Emmis
management team in forming Mediaco Holding," said Soo Kim. "We're thrilled to acquire two of
New York's legendary radio brands
in HOT 97 and WBLS and work with Emmis to build on each brand's
success. These stations will form the foundation for a new
public company that will invest in media assets and build on our
successful track record of media investments."
No personnel changes are planned. All New York employees
will continue to be Emmis employees with Emmis benefits as part of
an Employee Leasing Agreement with Mediaco.
After this transaction and the previously announced sale of our
partnership interest in Austin,
Emmis will operate New York's WLIB
and WEPN (through an LMA with ESPN Radio), four radio stations in
Indianapolis, Indianapolis
Monthly, and Digonex, a dynamic pricing company. Emmis
also owns its headquarters at 40 Monument Circle, Indianapolis, and a valuable tower site in
Whitestown, Indiana.
Moelis & Company acted as an advisor in this transaction,
and Taft Stettinius & Hollister LLP served as legal counsel to
Emmis. Morgan, Lewis & Bockius LLP served as legal
counsel to Standard General.
About Emmis Communications
Emmis Communications Corporation (Nasdaq: EMMS) currently owns 11
FM and 3 AM radio stations in
New York, Austin (Emmis has a 50.1% controlling interest
in Emmis' 6 radio stations located there) and Indianapolis. Emmis also owns Indianapolis
Monthly magazine and a controlling interest in Digonex, which
provides dynamic pricing solutions across multiple industries.
Note: Certain statements included in this press release which
are not statements of historical fact, including but not limited to
those identified with the words "expect," "will" or "look" are
intended to be, and are, by this Note, identified as
"forward-looking statements," as defined in the Securities and
Exchange Act of 1934, as amended. Such statements involve known and
unknown risks, uncertainties and other factors that may cause the
actual results, performance or achievements of the Company to be
materially different from any future result, performance or
achievement expressed or implied by such forward-looking
statement.
Such factors include, among others:
- general economic and business conditions;
- fluctuations in the demand for advertising and demand for
different types of advertising media;
- our ability to service our outstanding debt;
- competition from new or different media and
technologies;
- loss of key personnel;
- increased competition in our markets and the broadcasting
industry, including our competitors changing the format of a
station they operate to more directly compete with a station we
operate in the same market;
- our ability to attract and secure programming, on-air
talent, writers and photographers;
- inability to obtain (or to obtain timely) necessary
approvals for purchase or sale transactions or to complete the
transactions for other reasons generally beyond our
control;
- increases in the costs of programming, including on-air
talent;
- fluctuations in the market price of publicly traded or other
securities;
- new or changing regulations of the Federal Communications
Commission or other governmental agencies;
- enforcement of rules and regulations of governmental and
other entities to which the Company is subject;
- changes in radio audience measurement
methodologies;
- war, terrorist acts or political instability; and
- other factors mentioned in documents filed by the Company
with the Securities and Exchange Commission.
Emmis does not undertake any obligation to publicly update or
revise any forward-looking statements because of new information,
future events or otherwise.
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SOURCE Emmis Communications
