Lew Dickey 2017

More than two years after Lew Dickey formed Modern Media Acquisition Company to buy a media, entertainment or marketing company, the company’s shareholders have approved its purchase of streaming music service Akazoo. The greenlight came right down to the wire: Dickey has until Sept. 17 to close the deal or else he has to return the money contributed by MMA’s shareholders.

A regulatory filing shows that the initial $200 million Dickey raised for his so-called blank check company has dwindled to just $14 million. That’s because most of its stockholders have redeemed their shares and not become involved with the investment Dickey ultimately made. MMA’s outstanding shares have shrunk from more than 20 million to just 1.346 million as of Aug. 28. It’s not unusual for shareholders to redeem their stock in these types of companies when it takes longer to close a deal than initially anticipated or when the investment takes a different direction than initially planned.

While Dickey, the former CEO of Cumulus Media, needs $53 million to get the deal across the finish line, he won’t be relying on just the money in the trust. According to an earlier filing, Dickey is raising cash by selling securities through what’s known as a PIPE, or a private investment in a public equity, a commonly used practice in this type of business combination. That is expected to raise the needed capital to cinch the deal.

Blank-check companies, more formally known as a Special Acquisition Company, are notoriously complex. In simplistic terms, it’s like a hunting license that allows the company to look for targets to merge into and take public. This is done by using a cash shell that is a public vehicle. Once the acquirer merges with the target, the investment vehicle goes away and the merged entity goes public. In this case, Akazoo (the target) would take Modern Media’s NASDAQ listing and trade publicly under the ticker “SONG.”

In its ninth year of operation, Akazoo specializes in emerging markets with 4.3 million subscribers for its premium music service in 25 countries across Europe, Southeast Asia, South America and Africa. Akazoo doesn’t currently operate in the U.S. With a catalogue of 45 million songs and a free radio service providing access to 100,000 stations, Akazoo expects to grow to 10 million paid subscribers by 2021.

After two years of working with a blank check company, Dickey may not be eager to use this route again. The longtime radio exec is said to be working on other projects in the meantime.