The largest radio station owner in the US, iHeartMedia, has filed for Chapter 11 bankruptcy to reduce some of its $20 billion debt.
The company has reached an agreement in principle with holders of more than $10 billion of its outstanding debt and its financial sponsors. iHeartMedia says the agreement has support across the capital structure for a comprehensive balance sheet restructuring that will reduce iHeartMedia’s debt by more than $10 billion.
Chief Executive Bob Pittman: “The agreement we announced today is a significant accomplishment, as it allows us to definitively address the more than $20 billion in debt that has burdened our capital structure. Achieving a capital structure that finally matches our impressive operating business will further enhance iHeartMedia’s position as America’s #1 audio company.”
IHeartMedia has 858 radio stations, and said cash on hand and cash generated from ongoing operations will be sufficient to fund the business during the bankruptcy process.
The company has long argued that were it not for its debt payments, it would be a profitable group.
SiriusXM owner Liberty has proposed a deal to buy a 40% stake in a restructured iHeartMedia, bringing SiriusXM stations together with iHeartMedia stations.
Clear Channel Outdoor is not included in the bankruptcy.