iHeartMedia Inc.’s hard-won bankruptcy accord allows lenders to re-open the deal if bids emerge from a buyer like Liberty Media Corp. -- a development that some senior creditors would welcome, according to Bloomberg citing people with knowledge of the process.
Those creditors fought hard for language in the restructuring support agreement that lets them continue to explore “consistent alternative proposals,” said the people, who asked not to be identified because the negotiations are private. That clause was heavily contested in talks before iHM filed for court protection, a company lawyer said during a bankruptcy hearing on Thursday in Houston.
The group is open to options including a higher offer from Liberty or other strategic buyers who may be attracted by Liberty’s bid for iHM, the people said. Liberty Chief Executive Officer Greg Maffei had publicly outlined an alternative bankruptcy plan in which Liberty would acquire a 40 percent stake, and has said he’s willing to consider boosting the offer.
Liberty, controlled by billionaire John Malone, had been buying up iHM debt in recent months with an eye on getting control of iHM’s radio business after it reorganizes in bankruptcy. In a late bid to play the role of white knight, Liberty and SiriusXM offered to inject $1.16 billion of new money and provide a loan to keep iHeart in business through the bankruptcy process.
iHM said in a statement accompanying its filing that it has enough cash on hand to keep operating without a new loan.
That doesn’t mean investors have heard the last of Liberty. Maffei told attendees at an industry conference earlier this month there are “enormous” synergies for the ailing iHM with two other Malone investments -- the majority-owned satellite radio giant SiriusXM Holdings Inc. and Pandora Media Inc., the online music company where Liberty took a minority position last year.
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