Spanish Broadcasting System Inc. –

MIAMI – Spanish Broadcasting System Inc., a Spanish radio station operator, went public October 28, offering 21.8 million shares at $20 apiece. The company’s stock priced above its $17 to $19 filing range.

Lehman Brothers and Merrill Lynch & Co. underwrote the offering, which left 57 million shares outstanding.

CIBC World Markets Inc. and The Mainstay Funds were venture backers.

The company owns and operates 13 Spanish radio stations, including WSKO in New York, KLAX in Los Angeles, WRMA in Miami, WLEY in Chicago and KLEY in San Antonio.

The $227 million in proceeds expected from the offering will be used to redeem the company’s preferred stock at 105% of aggregate liquidation preference, repurchase its 11% notes and 12.5% notes at approximately 111% and 114% of their par value, respectively, to purchase an annuity for two of its retiring executives at an estimated cost of approximately $10.6 million, and for general corporate purposes.

Spanish Broadcasting lost $6.2 million in 1997, but has been profitable thereafter, earning $18.8 million in 1998.

No venture backers joined the company’s board of directors.

Spanish Broadcasting System – Selected Financial

(in thousands, except per share data)

Year Ended Nine Months Ended

Sept. 29, 1996 Sept. 28, 1997 Sept. 27, 1998 June 28, 1998* June 27, 1999

Total revenue 48,635 60,010 76,143 54,591 70,355

Net income (loss) -4,486 -6,169 18,785 19,116 4,294