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Monday, October 10, 2016

Indy Radio: Smulyan Again Extends Emmis Go-Private Deadline

Emmis Communications Corp. CEO Jeff Smulyan on Friday again extended his $4.10-per-share offer to take the radio company private for a third time.

In a letter to the special committee of the board of directors sent Friday, Smulyan moved the deadline from Friday to Oct. 14. The original deadline for the deal, unveiled Aug. 18, had been Sept. 16.

The Indy Business Journal reports the additional extension, announced after the close of trading Friday, might be a sign that Smulyan and the special committee are at odds over price.

Shareholders have become more skeptical the deal will close as talks have dragged on. The stock, which traded as high as $4.25 in late August, closed Friday at $3.98, down 3 cents on the day.

Some shareholders have said they think the $4.10-per-share offer—which represents a 25 percent premium to Emmis’ average closing price over the 90 days before the deal was announced—is too low.

This marks the third time Smulyan has proposed taking the company private in the last 10 years. A 2010 attempt was blocked at the 11th hour by a group dissident investors. Smulyan called off the 2006 deal after he couldn't reach terms with the board.

InsideRadio reports that during the company’s fiscal second quarter results call on Thursday, Smulyan said he has had “productive, professional” negotiations with the special committee evaluating the proposal, but that he did not have any update on a possible deal. Smulyan reiterated his position that his purchase offer is in the best financial interests of the company. “We believe it makes more sense for this company to be private, because of all of the costs and because of some of the other issues of being a public company of this size,” he said.

Ultimately, Smulyan said it is up to Emmis’ shareholders to decide the company’s future course. “We’ll negotiate in good faith with the special committee. If we reach an agreement, it will be up to shareholders. They’ll decide if they want liquidity and if they want the ability to cash out or they don’t,” Smulyan said.

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