Radio giant that owns Atlanta stations files bankruptcy plan to reduce debt
- Author: Eleanor Harrison Mar 16, 2018,
Mar 16, 2018, 0:35
iHeartMedia have reportedly agreed a restructuring deal with investors which hold over $10 billion of the debt to reduce their outstanding bills by half. "Achieving a capital structure that finally matches our impressive operating business will further enhance iHeartMedia's position as America's No. 1 audio company.iHeartMedia has created a highly successful operating business, generating year-over-year revenue growth in each of the last 18 consecutive quarters".
iHeart, formerly known as Clear Channel, is the nation's largest radio company, with more than 850 stations.
The San Antonio-based company is the largest radio station group owner in the United States, overseeing more than 850 terrestrial radio stations. Clear Channel was not part of the bankruptcy filing. For years, the company has been saddled with $20 billion in debt, the legacy of a leveraged buyout in 2008. And both companies are trying to restructure their debt.
Late last month, John Malone's Liberty Media made a last-minute offer to take a 40% stake in the reorganized company for $1.1 billion. According to the statement, the company says it has enough cash on hand to fund and support the business as it moves through bankruptcy proceedings. The creditors' counteroffer sought a higher stake in the company - 94.75% - while offering the equity holders nothing.
About 265 million people in the USA still tune in to iHeart's stations at least once a month, but newer media such as Spotify's streaming service and SiriusXM's satellite broadcasts have cut into the audience and put a damper on sales. Over the past five years, the company has spent more on debt payments than it has earned.