Largest U.S. radio company iHeartMedia files for bankruptcy

[Eugene]

Source: Reuters

(Reuters) - IHeartMedia Inc filed for Chapter 11 bankruptcy on Thursday as the largest U.S. radio station owner reached an in-principle agreement with creditors to restructure its overwhelming debt load.

The company, which filed for bankruptcy along with some of its units, said it ?reached the agreement with holders of more than $10 billion of its outstanding debt for a balance sheet restructuring, which would reduce its debt by more than $10 billion.

IHeartMedia, which has struggled with $20 billion of debt and falling revenue at its 858 radio stations, said cash on hand and cash generated from ongoing operations will be sufficient to fund the business during the bankruptcy process.

“The agreement ... is a significant accomplishment, as it allows us to definitively address the more than $20 billion in debt that has burdened our capital structure,” Chief Executive Bob Pittman said.

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DEALS MARCH 15, 2018 / 1:19 AM / UPDATED 2 HOURS AGO
Tom Hals
3 MIN READ


Read more: https://www.reuters.com/article/us-iheartmedia-bankruptcy/largest-u-s-radio-company-iheartmedia-files-for-bankruptcy-idUSKCN1GR0GB

[GreydeeThos]

1. The boat anchor dragging IHeart down was conservative talk radio

[BumRushDaShow]

2. ***THIS is Clear Channel***

Note that this is the 2nd Bain-related vulture capitalist entity to fail (along with Toys R Us).

<...>

Bain Capital LLC and Thomas H. Lee Partners LP control 68 percent of the voting stock of iHeartMedia, according to the company’s most recent annual report.

The private equity firms led a $17.9 billion leveraged buyout of what was then Clear Channel Communications Inc in 2008, just as the buyout boom was fading and as the signs of the financial crisis began to emerge.

Shares of iHeartMedia lost three-quarters of their value in the second half of 2015 and have never recovered since then. On Monday, the pink sheet stock closed at 48 cents.

https://www.reuters.com/article/us-iheartmedia-bankruptcy/largest-u-s-radio-company-iheartmedia-files-for-bankruptcy-idUSKCN1GR0GB

It's like the rot of the GOP is oozing out.

[DeminPennswoods]

3. Bain probably loaded the company with debt

to pay themselves because that's what these private equity firms do.

[ArizonaLib]

5. "Cash on hand and cash generated from ongoing operations will be sufficient to fund the business..."

...during the bankruptcy process. They will get protection from the debt, take it off the books, and when the stock price increases a little, they will cash out again. Minor shareholders will be lucky to get anything close to their original investment. This should be illegal - it is a scam hiding behind a false reference to 'capitalism'.

[groundloop]

8. EXACTLY..... everyone gets screwed except the venture capitalists

I've ridden through a bankruptcy like that at a previous employer. Many good people lost their jobs, contractors and vendors got screwed, all the stock which employees held through the company stock purchase plan evaporated, and the venture capital LLC skated away with $Millions. Bankruptcy, when used like this, is nothing more than legalized theft.

[left-of-center2012]

4. Programs ... include :

America Now with Meghan McCain,
The Glenn Beck Program,
The Rush Limbaugh Show,
The Sean Hannity Show,
Coast to Coast AM with George Noory,
The Mark Levin Show,
The Dave Ramsey Show

https://en.wikipedia.org/wiki/IHeartMedia#News_talk_stations

[hatrack]

6. "Talent on loan from God, funding on loan from Bain"

Good luck, y'all - must be wonderful in your line of work when the average listener age can best be described as "Jurassic".

[Bengus81]

7. Pfffttt.... Corporate controlled BS BORING radio stations with their 40 song play list..........

They all SUCK compared to when these stations were owned LOCALLY by one or several individuals and actually had a real playlist. Now it's just Corporate BS aimed at commercial after commercial and then back to the same songs you heard yesterday all tightly controlled by computer.

[rsdsharp]

11. I agree with your post to some extent

but in the mid to late 70s, when Top 40 was still an actual format, the current playlist on most stations topped out at 30, and many played as few as 14-16 songs with the top 3 in very tight rotation (generally #1 every 70 minutes, #2 every 80 minutes, and #3 every 90-100 minutes). This was expanded somewhat by recurrents, maybe a few album cuts and the gold library, but at many stations no gold songs prior to 1964 were played.

To your point, that was at a time when the rule of sevens applied (no one person or entity could own more than 7 AM, 7 FM and 7 TV stations, of which no more than 5 could be VHF). Still, the networks all had owned and operated stations. By way of example, ABC had WABC and WPLJ in NYC, WLS and WLS-FM/WDAI in Chicago, KQV in Pittsburgh, WXYZ in Detroit, KABC in LA among others. The rule of sevens was backed up by the duopoly rule preventing any person or entity from owning more than one AM, one FM and one TV station in any given market.

The Telecommunications Act of 1996 swept away the limits (they had actually been expanded prior to that), leading to the gobbling up of radio stations by large corporations, some of whom gobbled up the other corporations doing the gobbling. This was exacerbated by the death of the Fairness Doctrine which gave rise to right wing radio, all of which led us to the current sorry situation in radio.

[Maggiemayhem]

9. I ❤️ AKA Clear Channel

Rush Limbaugh’s 400 million dollar eight year contractin 2008 was the start of their downfall.

[UpInArms]

10. Bain Capital is Romney

Amazon didn't kill Toys 'R' Us. Here's what did

Toys "R" Us' debt problems date back to well before Amazon (AMZN) was a major threat. Its debt was downgraded to junk bond status in January of 2005, at a time when Amazon's sales were just 4% of their current level.

A year later the company was taken private by KKR, Bain Capital and real estate firm Vornado. The $6.6 billion purchase left it with $5.3 billion in debt secured by its assets and it never really recovered.

The company, and its actions during its first 15 years, became the subject of political and media scrutiny as a result of co-founder Mitt Romney's later political career, especially his 2012 presidential campaign.