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Moody's Smiles on The Planned Cumulus/Citadel Deal

February 22, 2011 

Moody's placed the ratings of Cumulus Media on review for a possible upgrade following the announced terms of the proposed acquisition of Citadel. "Moody's believes that the potential for lower leverage, synergies and favorable diversification from the proposed acquisition improves the financial profile of the company. The acquisition terms include a $500 million equity infusion, and Moody's expects Cumulus's Moody's adjusted debt/EBITDA leverage will decrease by more than 1 turn, from leverage of 7.6x at LTM 9/30/2010 (including Moody's standard adjustments).

"Cumulus plans to acquire Citadel's 225 radio stations in over 50 markets and also the Citadel Media business, which is among the largest radio networks in the US. After giving effect to the proposed acquisition, Cumulus would operate approximately 570 radio stations, and would be well-diversified given the combination of Cumulus, CMP Susquehanna, and Citadel stations across 120 markets nationally. The approximate $1.8 billion purchase price will be financed by a combination of $500 million in equity financing from Crestview Partners and Macquarie Capital, and the assumption of about $770 million in outstanding Citadel debt, which is expected to be repaid".



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