Big-Fish Radio Capital Shaky in 2017

The second fiscal quarter’s come and gone, so it’s worth reviewing how the first half of the year’s played out for radio’s big-fish investment-games:

Clear Channel iHeartMedia: The #1 radio conglomerate in the country just extended its long-term debt refinancing offer to reluctant bondholders for the twelfth time. While going through those motions a key coalition of creditors — who hold more than 10% of iHeart’s $20+ billion debt – have been mulling over the implications of tipping the company into Chapter 11 bankruptcy.

Apparently, they’ve devised a plan by which if they’re given 49% of the company’s equity and more favorable debt-repayment terms, they’ll keep the debt-refinance shuffle going. After missing a full payment in 2016 the company ponied up on schedule this summer toward debt due in 2021. More than $8 billion comes due in 2019. Read More

iHeartMedia At Debt Wall

Looks like the time is nigh for Clear Channel iHeartMedia to pay the piper.

Those who hold a significant portion of iHeart’s $20+ billion in debt are balking at the company’s attempt to kick the can down the road. This spring, iHeart floated proposals to creditors to extend the time the company gets to pay back on its debt while pegging a higher interest rate and some equity to the revised payback-plan. The offers were roundly rejected – fewer than 1% of existing note-holders accepted the terms, and now the company’s repeatedly extending the deadline to creditors hoping they will accept it. Read More

Radio Finance Capital: Dominos Aligning

It’s not a long line of dominos – just three in particular – but if they begin to fall you can bet there’ll be collateral damage throughout the radio industry.

The most wobbly of the three is Cumulus Media. The #2 radio station conglomerate in the country by stations owned, the company just can’t get a break with its turnaround endeavors. After an 8-to-1 reverse stock split last year which temporarily raised its share-price above the critical $1 floor for listing on NASDAQ, the company’s gone underwater again. Thursday’s trading-close saw CMLS shares at just under 27 cents, making for a total market capitalization just above $8 million. That’s about half of what it was just a month ago. Earlier this month, NASDAQ started the delisting-clock again, which means Cumulus has six months to implement a revival-plan and stick to it.

Of course, the aggregate value of Cumulus’ hundreds of radio station licenses is multiples higher than the market value of its stock, but most definitely not enough to cover the $2+ billion in debt it carries. A refinancing proposal using stock imploded last month, prompting Bill Cunningham in Media Life (just before it shut down) to observe that “Unless some white knight comes along, Cumulus has no choice but to file for bankruptcy protection. It could come in a matter of weeks.” Read More

Radio Industry’s Money-Flings

The money-shuffle has intensified in the radio industry as of late:

Clear Channel iHeartMedia: Still saddled with more than $20 billion in debt – of which more than $8 billion comes due in 2019 – the company’s going to great lengths to shuffle revenue between its subsidiaries to keep on top of its obligations. The latest move involves iHeart’s outdoor billboard division, one of the more financially solvent of the bunch, turning over nearly 90% of its latest quarterly dividends to the parent company.

In addition, iHeart filed papers with the Securities and Exchange Commission recently regarding the potential for its outdoor division to acquire the intellectual property to the words “Clear” and “Channel.” This sounds like the corporate version of scrounging for change in couch cushions; no word on how much those two words, separately or in conjunction, might actually fetch.

iHeart’s recent debt-exchange, for which it traded notes due in 2018 for paper payable in 2021, was classified by Moody’s Investor Services as a combination “distressed exchange (DE) and a Default due, in part, to the extension of the maturity date beyond its initial terms and the company’s very high leverage levels,” further observing that “the company will remain poorly positioned to withstand an economic recession or any material weakness in terrestrial radio in the future.” Read More

Nodes of Resistance: Sampling the Haitian Diaspora via FM+Internet

17 years ago(!), I left a budding career in radio journalism out of disgust with the trajectory the industry was taking. The break-point came when the National Association of Broadcasters and National Public Radio teamed up in Congress to conduct a disinformation campaign designed to eviscerate the FCC’s then-newly proposed LPFM radio service.

However, A few months before I actually quit my job, I acquired all the components necessary to start an unlicensed microbroadcast station. “System P” was a 40-watt frequency-agile FM rig that used a portable military surplus antenna mast to conduct tactical broadcasts from a wide variety of locations. You could often hear the station in Madison, Wisconsin, primarily on evenings and weekends; but since the station was mobile much fun was had taking it to peoples’ homes and public events around the country to give the public a more substantive appreciation of the ease by which it could make “the public airwaves” very real.

Another key element of System P was to provide a last-mile node for what was then quite an experiemental webcast-activism scene (today commonly known as “livestreaming”). These often manifested in Independent Media Centers during times of protest, most notably against corporate global trade deals. Activists would converge on a city to fill the streets in order to disrupt the negotiation of these agreements, and the media coverage would invariably skew toward painting the activists as violent thugs and police/other security forces as the guardians of order. But when activists gained the ability to counteract this narrative – oftentimes by live reports from the streets directly – the discursive dynamic around these events changed. Read More