iHeartMedia files for bankruptcy
iHeartMedia CEO Bob Pittman weighs in on what Dow 20000 means for business leaders.
The owner of the nation's biggest radio station operator, iHeartMedia, filed for bankruptcy protection from its creditors, the company announced early Thursday morning.
The San Antonio-based company, which owns 856 stations and controls Clear Channel Outdoor Holdings, one of the world's biggest billboard firms, said it reached an agreement in principle for a balance sheet restructuring.
The deal, which has been filed with a bankruptcy court in Houston, was made with holders of more than $10 billion of its outstanding debt and its financial sponsors.
Clear Channel Outdoor and its subsidiaries have not applied for creditor protection.
“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," CEO Bob Pittman.
The news comes after Liberty Media Corp. proposed buying a 40% stake in a restructured version of iHeartMedia for $1.16 billion on Feb. 26. Liberty, controlled by John Malone, owns satellite radio service Sirius XM Holdings.
Earlier in February, iHeartMedia failed to make a $106 million bond payment, and utilized a 30-day grace period to strike a deal with its bondholders.
Private equity firms Bain Capital Partners and Thomas H. Lee Partners purchased the radio station and billboard giant – then Clear Channel – in 2008 for $17.9 billion. The two firms control about 68% of voting stock of iHeartMedia, according to the company’s most recent annual filing with the Securities and Exchange Commission.
The Pink Sheet stock closed at $0.48 on Wednesday and has fallen about 14.5% this year.