We are investigating Townsquare Media, Inc. (TSQ) (“Townsquare” or the “Company”) for potential violations of the federal securities laws.
On June 9, 2020, Townsquare disclosed in a U.S. Securities and Exchange Commission (“SEC”) filing that on June 3, 2020, the Company’s management “determined that a material impairment charge to the Company’s indefinite-lived intangible assets was required due to an error in the projected cash flows that were utilized in the Company’s valuation model and that a material impairment charge to the Company’s goodwill was required due to a change in the Company’s reporting segments.” Townsquare advised investors that it “expects that the impairment charge will be approximately $39.4 million on our FCC licenses and approximately $69.0 million on our goodwill” and that “[t]he impairment charges will be reflected in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.” In the same SEC filing, Townsquare advised investors that “our management determined that (a) our Consolidated Balance Sheets as of December 31, 2018 and 2017 and the related Consolidated Statements of Operations, Comprehensive Income, Changes in Stockholders’ Equity and Consolidated Statements of Cash Flows for the years ended December 31, 2018 and 2017, respectively . . . and (b) our unaudited Quarterly Financial Data for the first three quarters of the year ended December 31, 2019 and each quarter of the year ended December 31, 2018 . . . should be restated and therefore may no longer be relied upon due to the error in the projected cash flows that were utilized in our valuation model.” On these disclosures, Townsquare’s stock price fell $1.20 per share, or 18.52%, to close at $5.28 per share on June 9, 2020.