Some creditors to iHeartMedia Inc., including Pacific Investment Management Co., have retained financial and legal advisers as they eye a drop in revenue at a time when other indebted media companies are pushing ahead with debt restructurings.
Bloomberg reports the radio broadcaster and podcasting platform’s lenders are working with financial adviser Evercore and law firm Milbank, according to people with knowledge of the matter, who asked not to be identified discussing a private matter. Their holdings are weighted toward term loan debt that comes due in 2026, they said.
IHeartMedia shares fell to a record low earlier this month after the San Antonio, Texas-based company reported first-quarter revenue that missed analyst expectations. The stock is down more than 60% this year, and its debt trades at distressed levels.
 |
| Richard Bressler |
The slump in the company’s performance comes as demand for radio advertising has shriveled, with audiences turning to new options like Spotify to discover new music. Other industry players have responded by striking bargains with creditors to cope with their borrowing levels: Cumulus Media Inc. completed a debt exchange earlier this month, while Audacy Inc. filed for bankruptcy in January after reaching a pact with creditors.
IHeart had more than $5.2 billion of debt as of March 31 spread across various secured and unsecured facilities, according to regulatory filings. A roughly $1.8 billion term loan due in 2026 trades around 77.5 cents on the dollar, Bloomberg data show. An $800 million 6.375% note maturing in 2026 traded Wednesday at about 70.75 cents, down from around 86.5 cents on May 6, according to pricing source Trace.
IHeart filed for bankruptcy in 2018 after a leveraged buyout saddled it with debt as the digital era was already heaping pressure on the company. It emerged from Chapter 11 in 2019.
You can hear on Elvis Duran that they brought in someone on staff to help drive people to the show online, and through social media. They never come out directly and say it, but you can hear it in their voice that they have to do something to goose up their ratings. This is the show that killed so many local IHeart shows around the country from 6-10am. It's good, but you can tell they are starting to feel the pain.
ReplyDelete