iHeartMedia recently filed bankruptcy amidst reports they have $20 billion worth of debt. iHeartMedia, the United State’s largest radio company, has agreed to restructure its debt by roughly $10 billion. This news comes as no surprise, as the radio conglomerate failed to repay a portion of its debts in early March.
iHeartMedia was purchased by two private equity firms in 2008, towards the end of the buyout boom and the beginning of the financial crisis. This buyout was reportedly worth $17.9 billion, nearly the full amount of the debt registered before the restructuring.
Additionally, the company’s shares lost 75% of its value in 2015 and never rebounded, resulting in a bleak outlook for investors. With 855 stations, iHeartMedia is second to none in terms of size, and reaches 110 million listeners every month. The company also employs roughly 14,000 employees, so hopefully the reported restructuring results in a return to success.
Talkers Magazine publisher Michael Harrison said,
“What’s obvious is that they will continue to be able to operate. The actual business of radio is a viable business. It just has been hampered by a terribly large amount of debt that it accrued during the rise of consolidation.”