On Thursday, the iHeartCommunications Board of Directors decided not to pay $138 million in interest payments. The reason for this latest decision, according to an SEC filing, is that discussions are continuing with lenders, noteholders, and financial sponsors regarding a comprehensive debt restructuring. Another 30-day grace period to make the payments has been set in motion as a result of this decision. Back on February 1, the Board voted not to pay $106 million in interest payments due. That 30-day grace period is about to expire.
iHeart has over $20 billion in debt and has been in extensive discussions with lenders to restructure that debt.
The interest payments due on March 1, 2018 were approximately $59.1 million on its outstanding 11.25% Priority Guarantee Notes due 2021 and approximately $78.8 million on its outstanding 9.0% Priority Guarantee Notes due 2021.
Bloomberg is reporting that advisors to some of iHeart’s senior creditors have seen bankruptcy documents and a filing could come this weekend. Bloomberg says the bankruptcy filing is all but certain. iHeart has been swapping term sheets, for a restructuring, with some of its lenders, but has been unable to reach an agreement to this point. The company has over $20 billion in debt. A 30-day grace period, after the company decided not to make a $106 million interest payment, is about to expire.
Bloomberg Technology is reporting that Liberty CEO John Malone’s plan for a radio empire is now coming into focus. As we reported, Liberty made a last hour pitch to invest in iHeart as the company heads toward a possible bankruptcy filing. Liberty also owns a huge stake in SiriusXM and recently made a substantial investment in Pandora. On a call with investors Thursday, Liberty CEO Greg Maffei said there would be “substantial synergies” between iHeart, SiriusXM and Pandora. “With the advantage we can bring to the table we think we can perhaps reduce some of the risks that are inherent in the business.”