According to the Indy Star, Smulyan, the CEO of Emmis Communications Corp., dropped his $4.10-per-share bid amid criticism from investors that he was undervaluing the company. He let the nearly 2-month-old offer expire Friday.
"I am sorry we could not reach an agreement on the valuation," Smulyan said in a letter to Emmis' board. "I look forward to continuing to work with you as we move Emmis forward as a public company."
Smulyan's bid for outstanding shares amounted to a deal worth about $46.5 million. A handful of investors mounted opposition almost as soon as Smulyan submitted the offer Aug. 18. They argued in interviews and letters to the company's board that Smulyan failed to factor in the potential value of a product called NextRadio, which lets smartphone users access radio signals through their devices.
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| Jeff Smulyan |
John Reardon, a Pasadena, Calif.-based stock broker who opposed the go-private offer, said he thinks shareholders' criticism killed the deal.
"I think the pushback was very significant from all sides," Reardon said.
"I think Jeff Smulyan is a very smart guy," Reardon added. "He's worked very hard to get the NextRadio deal off the ground. I think it's going to be a tremendous success."
Emmis has the ninth-largest radio portfolio in the U.S., according to the company. Including the Terre Haute stations, it owns 19 FM and four AM radio stations in Indianapolis, New York, Los Angeles, St. Louis and Austin, Texas. Emmis' best-known stations include WIBC 93.1 FM in Indianapolis, KPWR 105.9 FM in Los Angeles, known as Power 106, and WQHT 97.1 FM in New York, known as Hot 97.
Smulyan started Emmis in 1979 with the acquisition of a Shelbyville radio station. The company went public in 1994.
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