Sign up for our daily briefing
Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.
Catch up on the day's biggest business stories
Subscribe to Axios Closer for insights into the day’s business news and trends and why they matter
Stay on top of the latest market trends
Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.
Sports news worthy of your time
Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.
Tech news worthy of your time
Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.
Get the inside stories
Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.
Catch up on coronavirus stories and special reports, curated by Mike Allen everyday
Catch up on coronavirus stories and special reports, curated by Mike Allen everyday
Want a daily digest of the top Denver news?
Get a daily digest of the most important stories affecting your hometown with Axios Denver
Want a daily digest of the top Des Moines news?
Get a daily digest of the most important stories affecting your hometown with Axios Des Moines
Want a daily digest of the top Twin Cities news?
Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities
Want a daily digest of the top Tampa Bay news?
Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay
Want a daily digest of the top Charlotte news?
Get a daily digest of the most important stories affecting your hometown with Axios Charlotte
Photo: Jeff Kravitz/FilmMagic for iHeartRadio
iHeartMedia, the holding company of iHeartRadio Inc., the biggest operator of radio stations in the United States, has filed for Chapter 11 bankruptcy. The San-Antonio-based group reached an in-principle agreement with creditors to restructure an overwhelming amount of debt that had compounded since a private-equity buyout over a decade ago.
Why it matters: iHeartRadio, which owns over 850 radio stations throughout the country, has seen advertising revenues fall flat to major technology companies — much like others in the traditional media landscape.
iHeartMedia also owns a 90% stake in Clear Channel Outdoor Holdings Inc., a billboard company where most of the company's cash on hand comes from, and runs a popular concert business. The company has been unable to offload Clear Channel to lenders in exchange for relief and will not be filing that unit for bankruptcy.
“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. Achieving a capital structure that finally matches our impressive operating business will further enhance iHeartMedia’s position as America’s #1 audio company.”— Bob Pittman, iHeartMedia's Chairman and CEO
The company was faced with $20 billion in debt which had compounded roughly over the past ten years.
- Executives expect the agreement with owners to offload $10 billion of that debt for a financial restructuring will reduce debt enough to keep the company operating with the cash it has on hand.
- Day-to-day operations of its businesses, at least for now, are not expected to be dramatically affected.
iHeart has seen its business take a hit from the rise of audio streaming, mainly via Pandora and Spotify.
- The company launched a subscription service last year with Napster, which has been successful, but not enough to save the company from the mounting debt.
- Its terrestrial radio business, the largest in the country, also struggled to maintain advertising revenues to offset mounting debt costs.