iHM Negotiations With Creditors Not Going Well

iHeartMedia Inc. said it may break off negotiations on restructuring some of its $21 billion of debt after failing to reach an agreement with some of its creditors, according to Bloomberg.

iHM is assessing whether it will continue discussions “given the significant gap between the proposals,” the company said in a statement on Tuesday.

Franklin Resources Inc.’s subsidiary Franklin Advisers Inc. is the biggest holder of iHM's $6.3 billion of term loans and has been leading the discussions, according to a person with knowledge of the matter, who asked not to be identified because the talks are private.

The group of holders last month lost the suit against iHM, claiming the company was in default due to a $100 million of stock transfer between subsidiaries. Stacey Coleman at Franklin Resources declined to comment.

iHM has been looking to push out maturities on its debt and reduce its interest expense, people familiar with the matter said in March. But no agreement has been reached and there’s no guarantee that it will get done, the company said in the filings.

Failure to strike a deal will add to iHeartMedia’s difficulties in restructuring its debt load, of which about $10 billion is coming due in the next three years. Much of these obligations were accumulated as part of a leveraged buyout by Bain Capital LLC and Thomas H. Lee Partners in 2008.

"We continue to evaluate various opportunities to strengthen our capital structure for the benefit of our stakeholders, and we remain focused on positioning iHeartMedia for long-term growth," said Wendy Goldberg, a spokeswoman at iHeartMedia.