Radio conglomerate Audacy is getting ready to file chapter throughout the subsequent few weeks, in accordance with a latest Wall Road Journal report.
The Philadelphia-based radio firm owns lots of of stations throughout the USA, however it’s grappling with almost $2 billion in debt. In the meantime, promoting throughout all spectrums has declined—contributing to a decline in income. Audacy reported a $234.3 million loss in Q3 2023, skipping a debt cost in September. One other SEC submitting reveals Audacy delayed debt compensation of $18.9 million that was due in December 2023.
“Audacy’s third quarter internet revenues declined 5.6%, in-line with our quarterly steerage as advert market circumstances have remained difficult, notably on nationwide enterprise,” Audacy CEO David Area instructed traders throughout its Q3 2023 monetary report. Now it seems the corporate has quietly been engaged on a chapter plan.
In accordance with new reporting by the Wall Road Journal, Audacy has negotiated its chapter plan with its lenders, who’re anticipated to imagine possession after an organization restructure. Audacy owns 230 radio stations throughout the USA, however its monetary well being has been in query since its 2017 merger with CBS Radio when a substantial portion of debt was assumed as a part of that deal.
It’s unclear whether or not David Area will stay CEO of Audacy after the corporate emerges from chapter proceedings. It’s additionally murky whether or not Audacy will have the ability to retain expertise amid belt-tightening with the chapter underway. Fairness analysis analyst Craig Huber says the CBS Radio merger is why Audacy is struggling right now.
“The ill-advised merger with CBS Radio in late 2017, which added round $1.5 billion in debt, turned the undoing of the corporate,” Huber instructed RadioWorld. Restructuring adviser PJT companions and legal professionals from Latham & Watkins are reported to be serving to the corporate. Senior lenders are working with Gibson Dunn & Crutcher, whereas a second group of lien bondholders has partnered with Akin Gump Strauss Hauer & Feld.