IHeartRadio Files For Bankruptcy After Accumulating Over $20 Billion In Debt

Ivan Schwartz
March 16, 2018

It's $20 billion in debt makes it the largest bankruptcy in the previous year, and around the 30th largest ever.

iHeartMedia's debt issues have been plaguing the company for years, with obligations exceeding $20 billion.

The company that became iHeartMedia was founded in 1972 and was known as Clear Channel Communications until it changed its name about 10 years ago.

Saddled with $20 billion in debt, iHeartMedia today announced that it has filed for Chapter 11 bankruptcy protection, and is reorganizing its financial obligations. "Achieving a capital structure that finally matches our impressive operating business will further enhance iHeartMedia's position as America's #1 audio company".

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RadioInk reported that the iHeartCommunications' board compensation committee "approved millions of dollars in bonuses for iHeart CEO Bob Pittman, COO Richard Bressler, and General Counsel Robert Walls". The company, which streams music online, also owns 850 radio stations and promotes concerts.

IHeartMedia has maintained that its radio stations remain popular and vital even as it has introduced apps and negotiated new licensing deals meant to control its royalty payments online. Debt holders would have received 89.5% of the company's total equity.

Among its branding partners is Bell Media, which owns Canada's largest private-sector radio network as well as the CTV network, conventional local television stations and specialty TV channels including the music-oriented Much. This will unite iHeart Radio with Liberty's Sirius XM Holdings satellite radio service.

Kopecki says the bankruptcy filing won't have an immediate impact on day-to-day operations at the company, though I Heart Media bondholders will lose a lot of money. Spotify, which recently filed for an initial public offering, said Thursday that its shares would begin trading on the New York Stock Exchange around April 3.

The largest radio company in the United States has filed for bankruptcy.

Other reports by GizPress

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