Filed by Cumulus Media Inc.
Pursuant to Rule 425 under the Securities Act of 1933
Subject Company: Citadel Broadcasting Corporation
Commission File No.: 001-31740
The following is a transcript of an interview of Lewis W. Dickey, Jr., Chairman, President and CEO
of Cumulus Media Inc., on CNBC on March 10, 2011.
This communication contains forward-looking statements regarding the acquisition of Citadel
Broadcasting Corporation by Cumulus Media Inc. and related financing, which include expected
earnings, revenues, cost savings, leverage, operations, business trends and other such items, that
are based on current expectations and estimates or assumptions. These forward-looking statements
involve risks and uncertainties that could cause actual results to differ materially from those
predicted in any such forward-looking statements. Such factors, include, but are not limited to,
the possibility that the acquisition or the related financing is not consummated, the failure to
obtain necessary regulatory or stockholder approvals or to satisfy any other conditions to the
acquisition, the failure to realize the expected benefits of the acquisition, and general economic
and business conditions that may affect the companies before or following the acquisition. For
additional information regarding risks and uncertainties associated with Cumulus, see its filings
with the Securities and Exchange Commission (SEC), including its Form 10-K for the year ended
December 31, 2009 and subsequently filed periodic reports. Cumulus assumes no responsibility to
update the forward-looking statements contained in this release as a result of new information,
future events or otherwise.
This communication is provided for informational purposes only and is neither an offer to purchase
nor a solicitation of an offer to sell shares of Cumulus or Citadel. Cumulus will file a
registration statement, and Cumulus and Citadel will file with the SEC and mail to their respective
security holders an Information Statement/Proxy Statement/Prospectus in connection with the
proposed business combination. INVESTORS ARE URGED TO READ THOSE FILINGS, AND ANY OTHER FILINGS
MADE BY CUMULUS WITH THE SEC IN CONNECTION WITH THE PROPOSED BUSINESS COMBINATION, WHEN THEY BECOME
AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED BUSINESS COMBINATION. Those
documents, when filed, as well as Cumuluss other public filings with the SEC, may be obtained
without charge at the SECs website at www.sec.gov and at Cumuluss website at www.cumulus.com.
Cumulus and its executive officers and directors may be deemed to be participants in the
solicitation of proxies from Citadels stockholders. You can obtain more information about
Cumuluss executive officers and directors, and their beneficial interests in Cumuluss common
stock, from filings made with the SEC, which are available at the SECs website, www.sec.gov.
Information regarding any interests of the executive officers and directors in this transaction
will be contained in the Information Statement/Proxy Statement/Prospectus when it becomes
W. DICKEY, JR. INTERVIEW ON STRATEGY SESSION ON CNBC
March 10, 2011
Announcer 1: You know what, between the selloff and GM there was actually some other deal
making today. It was a story I broke right here, first. Cumulus Media agreeing to buy
Citadel Broadcasting in a cash to stock deal its about $2.5 billion. Lew Dickey, Chairman
and CEO of Cumulus, and he joins us in an exclusive interview. Welcome Lew nice to have
Lew Dickey: Thank you Dave nice to see you.
Announcer 1: Nice to see you too. Youre going to be running a company with $3 billion in
debt. Does that scare you at all?
Lew Dickey: Well its over $4 billion in assets and its going to be about a little more
than half a billion dollars of EBITDA David and generates an awful lot of free cash flow
and should delever about 3 quarters of a turn a year, so we think weve got a very solid
balance sheet. Its going to be very liquid and its going to be a very strong equity
market cap that will enable investors to in essence, play the recovery in local ads spend.
Announcer 1: Yeah, well I guess I want to get to that recovery. You think youre going to
be able to delever, what did you say, half a turn a year, is that right?
Lew Dickey: Well we think upwards of three quarters of a turn a year. Radio is an
interesting business in that it generates an awful lot of free cash. Low cap ex, high
operating leverage and thats a very attractive investment.
Announcer 1: Thats why you wanted to try and take Cumulus private a few years back,
Lew Dickey: Thats correct.
Announcer 1: Why do you see a continued rebound and tell me what youre seeing in terms of
the local advertising market? Youre going to have what, 570 stations or so around the
country. What are you seeing on the ground right now?
Lew Dickey: Well were going to have 570 stations, well be in 120 markets in eight of the
top ten U.S. cities, and then on top of that well have a fully distributed network to
really drive content and our technology assets through. So its going to be an amazing
platform. When we think about, you know, radio is a local medium, upwards of 85-88 percent
of its revenue is derived from the local economies and local ad spend is really a function
of local retail sales and we have a bullish view on that over the next 5 years. So when you
think about, that whats our competition and for really for local ad spend, its
newspapers, its directories, its shared mail and all of those businesses have their unique
challenges at this stage of the game
Announcer 1: I can think of a lot of competitors to your actual usage, which is things
like Pandora and obviously, you know, Im using my iPod in my car and I mean a million
other things that you know a lot more about than I do. Why are you confident the audience
is still going to be there in sufficient numbers for your advertisers to pay you?
Lew Dickey: Well you know empirically, youve had Neilson and youve had Arbitron
surveying the industry and the audience is there. Its spending about 18% of its time with
radio. And the reach of radio has never been greater and this platform alone is going to
reach about 60 million people a week. So youve got a business that has tremendous reach.
It has the ability to be fragmented and be flexible in terms of offering advertisers the
ability to target specific demographics based on the formats as you know that we have on
the individual radio stations and its already the low-cost provider in the market. So
when you think about everything else thats around us and competing for those local ad
dollars, we think radios got an excellent chance to at least maintain share if not
increase it, due to whats going on around it with as we say newspapers, directories and
Announcer 2: You know Lew, David mentioned the debt loads is this the optimal capital
structure for this combined company given the various different models that you have to run
with different scenarios for the economy at this point?
Lew Dickey: Gary, I think its going to be an excellent capital structure and obviously
our goal is to delever this down into the fours where I think is the optimal trading range
for this you want to have some leverage against this equity whenever youve got such high
free cash flow and it delevers so quickly. So, we think this makes a lot of sense, its a
very prudent capital structure and the balance sheets going to be very flexible and the
way weve structured it we believe weve got the optimal amount of flexibility coming out
of the gate here. Were very confident this is the right capital structure, which is why
weve designed it this way.
Announcer 1: Concerned at all your stocks off about 7 percent today, Lew?
Lew Dickey: Well its a tough tape as you know and the stock had run quite a bit. Since
the announcement the stock ran high teens and so I think its come back just a little bit
and people are trying to see which side of the transaction to play and its very tough to
buy the other side of it right now. The equity is somewhat illiquid. I think itll all
settle out, but when they see the trading range, excuse me, the trading multiple of the
combined pro forma entity, and as we get a chance to explain all of this on our earnings
call on Monday, I think the investment community is going to understand this is truly an
excellent deal and a great vehicle in order to, as I say, play the recovery and local ad
spend going forward.
1: Lew Dickey as always, very much appreciated. Nice to see you, even though
youre there, not here but one day youll come into the studio, I hope, as well.
Lew Dickey: Thank you David.
1: Youre very welcome. Lew Dickey, Chairman CEO of Cumulus. Interesting, its
a free cash flow story. Thats why you get guys, thats why they did
Clear Channel, Tom
Lee and those guys and thats why he considered taking Cumulus. A lot of free cash flow
still in that business.
Announcer 2: And we love free cash flow, thats why on paper this immediately looks like
its going to be one of those 1 out of 10 deals because it makes a lot of sense. But its
so reliant on what happens in the local advertising market, which is very reliant on what
happens in the global economy.
Announcer 1: No doubt about it.