iHeartMedia files bankruptcy to reduce debt

March 16, 2018 GMT

Radio giant iHeartMedia Inc. is seeking bankruptcy protection as part of an agreement with its lenders to reduce debt it took on to become a privately held company. Formerly known as Clear Channel Communications, the San Antonio-based company said Thursday that it will operate its businesses as usual while it restructures its finances under Chapter 11 protection to reduce debt by more than $10 billion.

Recognized as one of the world’s largest radio companies, iHeartMedia is a leading media outlet in the Delaware Valley region with six stations, including Power 99 FM, WDAS FM, Radio 104.5 FM, Mix 106.1, 1480 WJJZ AM and Q102 FM. In total, the media conglomerate operates 858 broadcast radio stations in more than 150 markets around the U.S.

The Associated Press reports “the reason for iHeartMedia’s financial problems is primarily its massive debt, which it amassed when private equity firms Thomas H. Lee Partners and Bain Capital led a buyback of publicly held shares to take the company private in 2008. iHeartMedia had warned in 2016 that it had reached an impasse with lenders.

“Though iHeartMedia has a large online presence and its iHeartRadio app is popular for streaming music, it faces stiff competition from Spotify, Apple Music and other online streaming services. 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.

“iHeartMedia Inc. said its billboard subsidiary, Clear Channel Outdoor, isn’t part of the bankruptcy proceedings.”

The Associated Press contributed to this report.