iHeartMedia Inc., the company behind the biggest U.S. radio broadcaster, filed for bankruptcy protection after reaching an agreement in principle with investors over a balance-sheet restructuring, a decade after a private-equity-led buyout left the company laden with billions in debt.
The chapter 11 filing in the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division, came after months of talks with shareholders.
iHeartMedia said in a statement early Thursday the agreement in principle was with holders of more than $10 billion of its outstanding debt and its financial sponsors. Based in San Antonio, iHeart operates 856 terrestrial stations and controls Clear Channel Outdoor HoldingsInc., one of the biggest billboard companies in the world.
The company said Clear Channel Outdoor and its subsidiaries didn’t commence chapter 11 proceedings. It also said its day-to-day operations would continue as usual during the restructuring process.
iHeartMedia said it believes its cash on hand, together with cash generated from continuing operations, will be sufficient to fund and support the business during the bankruptcy proceedings.
“The agreement we announced today is a significant accomplishment, as it allows us to definitively address the more than $20 billion in debt that has burdened our capital structure,” said Bob Pittman, the company’s chairman and chief executive.
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