iHeartMedia’s Debt Dance Intensifies

The nation’s #1 radio broadcast conglomerate stands another step closer to defaulting on nearly $21 billion of IOUs racked up during its consolidation and conglomeration spree of the last twenty years. For those just tuning in, iHeartMedia owes nearly $1.4 billion in debt payments between now and 2018, with nearly $200 million of that due this year.

The company announced a curious plan in late 2015 to ask some of its debt-holders to swap existing debt for stock, the idea being to try and retire the pressing debt first and keep the fiscal ship afloat. In practice, iHeart began shifting some of its assets into a subsidiary named Broader Media, which is effectively a subsidiary holding company within iHeart itself. Those who agreed to swap their debt in iHeart would get paid back in Broader Media equity. Read More

Window Brings Surge of Translator Deals

On Friday, the FCC opened a six-month filing window for AM broadcasters to acquire existing FM translators, and move them up to 250 miles into their local coverage areas. This is part of the agency’s AM revitalization initiative — though it’s still not exactly clear how FM spectrum fixes AM’s fundamental difficulties.

This window is exclusive to lower-power AM broadcasters; the large “flamethrower” stations will get a crack at the translator shuffle later this summer, and then the FCC plans to open an application window for new translator stations next year. The marketplace for translators, which has been simmering mightily underground for nearly a decade, has fully burst into the mainstream with the FCC’s blessing. Read More

iHeartMedia Facing Reorganization Pressures

Much interesting news on the iHeartMedia front already in the new year. The wildly overleveraged conglomerate ended 2015 with an announcement that it hoped to convince some of its shareholders to swap debt they hold against the company for stock. It’s assumed iHeart is still on track to try and float this proposal later this spring.

However, it would seem that some shareholders would like to take matters into their own hands. Just days after iHeart announced its swap-plan, the New York Post reported that several large stockholders planned to pressure the company to devote nearly $200 million this month toward debt reduction. This would shave off less than 1% of the $21+ billion the company owes, though it would be a small step toward ameliorating what one unnamed banker calls “clearly not a sustainable capital structure.” Read More