Cumulus Media announced on Friday that it was going to buy Dial Global for $260 million, allowing them access to thousands of stations with music, sports and talk programming. This purchase will create much needed competition for Clear Channel Communications, which has been dominating the radio industry for years. The complex transaction still needs to go through regulatory approval and will involve both the sale of certain stations to Townsquare Media in order to generate the cash needed to make the purchase. These smaller stations fit the business model of Townsquare, which primarily operates in smaller markets, and the remaining stations on Cumulus will primarily be in larger markets where Clear Channel and CBS Radio have dominated in the past.
Cumulus CEO, Lewis W. Dickey Jr., stated that the added stations would give the company the larger size it needed in order to work with affiliate and advertising partners, and allow them to work towards building their broadcast audience in the top 100 U.S. markets. The company will also focus on extending to other platforms such as online streaming in order to compete with services like Pandora, which are increasing being used in vehicles.
The sale is expected to be completed by the end of the year if it passes regulatory review.
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