Indianapolis-based Emmis Communications Corp. on Thursday announced two deals that will bring the company $92.5 million.
The money, company officials said, will be used to pay down debt and make Emmis one of the least leveraged radio station groups in the nation.
The news sent Emmis stock soaring 21.5 percent Thursday morning, to $1.05 cents per share. It's the first time Emmis shares have traded above $1 since July.
In one deal, Emmis will effectively lease air space at radio station 98.7 FM in New York to Disney Enterprises/ESPN.
The station is home to Kiss FM, Emmis’ adult urban radio station. ESPN will convert it to a sports-talk station April 30.
Disney agreed to pay Emmis $8.4 million for the first year of the deal with payments escalating 3.5 percent annually. The deal’s length is 12 years and four months to align with Disney’s fiscal year.
Emmis in turn has agreed to a deal with Teachers Insurance and Annuity Association of America, in which TIAA pays Emmis $82.5 million up front for the 148-month payment stream from the Disney deal, which will total more than $122 million over its life.
Emmis also signed a deal to sell the intellectual property of Kiss FM for $10 million to New Jersey-based YMF Media, which is acquiring New York radio stations WBLS-FM and WLIB-AM.
“I have so many friends on the Kiss FM team and this is an extraordinarily difficult decision for me, however the benefits to the financial health of Emmis as a whole are significant,” Emmis Chairman Jeff Smulyan said in a prepared statement.