Audacy has started discussions with two groups of creditors to restructure around $1.9 billion in debt, the company confirmed on Tuesday.
On Monday, the Philadelphia-based media firm had hired attorneys to work with lenders on the debt as the radio company continues to address revenue struggles brought on by a downturn in the advertising market.
“As we have previously stated we intended to do, we have initiated discussions with our lenders to refinance our debt and optimize our balance sheet to position Audacy for long-term growth as we continue to invest in our people, platform, technology, content and growth initiatives,” a spokesperson for Audacy said in a statement on Tuesday.
In May, Audacy indicated it might default on its debt when it filed a notice with the U.S. Securities and Exchange Commission warning investors that various macroeconomic conditions, including ongoing advertising woes, “have created, and may continue to create, significant uncertainty in operations.”
In the filing, Audacy suggested that its financial problems could result in lackluster revenue that would make it “unlikely to be sufficient” the broadcaster could continue operations as normal, including making ongoing debt payments to its creditors as required.
If Audacy defaults on those payments, the debt would be immediately owed, according to its agreements. That could ultimately force Audacy to explore filing for bankruptcy protection.
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