Cumulus Gets U.S. Clearance to Buy Citadel After Agreeing to Divestitures
Stock Chart for Cumulus Media Inc (CMLS)
Cumulus Media Inc. (CMLS) won U.S. Justice Department clearance to buy Citadel Broadcasting Corp. (CDELB) on condition that the company sell three radio stations in two markets to maintain competition in advertising.
Under a proposed settlement with the antitrust division of the Justice Department, Atlanta-based Cumulus must divest two stations in Pennsylvania and one in Michigan to buyers approved by the division, according to court documents. The settlement resolves a lawsuit the Justice Department filed today in Washington federal court.
“The divestitures required by the consent decree will enable radio advertisers to continue to receive the benefits of competition” in Harrisburg, Pennsylvania, and Flint, Michigan, Sharis Pozen, acting assistant attorney general in charge of the antitrust division, said today in an e-mailed statement.
The divestitures will reduce Cumulus’s share of advertising revenue in those regions to less than 40 percent, the Justice Department said in the statement.
Cumulus offered to buy Citadel in March in a deal valued at $2.4 billion to expand coverage and cut costs. The companies’ radio stations compete to attract local and national advertising that targets listeners in Harrisburg and Flint, according to the complaint.
The acquisition of Las Vegas-based Citadel would have eliminated the competition in those markets, increasing prices and reducing levels of service in the sale of radio advertising time, the U.S. said in the complaint.
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