An article Friday in the San Antonio Express provides a succinct account of Clear Channel's current financial situation:
CC Media Holdings, which also owns about 90 percent of a large outdoor-advertising company, Clear Channel Outdoor Holdings Inc., reported debt of $20.74 billion as of Sept. 30.
The company was taken private in 2008 by
Bostonprivate equity firms Bain Capital Partners LLC and Thomas H. Lee Partners LP in a $17.9 billion acquisition. However, 30 percent of its shares remain publicly traded.
The company said it lost $50.56 million in the third quarter ended Sept. 30, compared with a $74.05 million loss in the same quarter in 2011.
With smaller debt payments due in 2013, 2014 and 2015, CC Media Holdings will need to restructure its debt to make $10.1 billion of payments due in 2016, Moody's Investors Service said in a report last week.
If the company is to have a “realistic” chance of refinancing the obligations, its performance will need to improve “well above” current levels, Moody's analysts Scott Van den Bosch and Carl Salas wrote.
“The possibility of a restructuring or a distressed exchange remains high,” the analysts wrote. The “restructuring will be challenging as debt levels will exceed our expected asset value.”
CC Media Holdings may have slower revenue growth as more competition from digital radio lowers the number of listeners and reduces advertising sales, the analysts added.
CC Media itself has been investing in digital radio through its application iHeartRadio. The company is exploring adding advertising to the mobile telephone iHeartRadio application, Tom Casey, CC Media Holdings executive vice president and chief financial officer, told analysts last month.