CBS Corp. has taken a crucial step toward consummating the sale of CBS Radio to Entercom Communications Corp., a Bala Cynwyd-based company, by launching an exchange offer for its shareholders.

As part of what is called a Reverse Morris Trust maneuver, the offer allows CBS shareholders to exchange their Class B shares of common stock for shares of CBS Radio, which will be immediately converted into Entercom stock when the merger closes, writes Jeff Blumenthal for the Philadelphia Business Journal. 

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The offer expires Nov. 16. While the merger still requires regulatory consent from various government agencies, Entercom CEO David Field said in an SEC filing that the company is “continuing our work with those agencies and remain optimistic that we will receive their approvals in a timely manner and close our merger in the fourth quarter, possibly as early as Nov. 17.

CBS Chairman and CEO Leslie Moonves said the exchange offer “will give equity holders the opportunity to invest in what we believe will be a best-in-class radio company, with top assets and a terrific management team. And for CBS, we expect that it will unlock even more value and allow us to become even more focused on the creation and distribution of premium video content.”

In order to obtain regulatory approval for the planned $1.7 billion acquisition, Entercom agreed last week to divest 16 radio stations in four different cities to comply with antitrust rules. The divestitures were necessary because Entercom would have owned stations in seven markets in excess of the limits set forth in the FCC’s local radio ownership rule.

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