A fourth extension to the negotiations was announced Wednesday morning, as iHeart and lenders continue day-to-day negotiations to restructure iHeart’s $20 billion of debt. This latest extension was the second 24-hour extension. It expires at 11:59 tonight.
This story was updated at 7:35 a.m. Wednesday morning.
That’s because another extension of the forbearance agreement was signed by iHeart and lenders on Monday, however it was only for 24 hours, and it expired last night at 11:59. It was the third extension. Following each extension, news of progress – or lack thereof – has come out early the next morning. That would be today. So, if that same routine continues, we should hear how negotiations on iHeart’s $20 Billion in debt are going at about 7AM this morning.
The first two extensions were followed by three more days of negotiations. This third extension was extended by only one day. That could indicate that the two sides are close to an agreement. It could also indicate they are not close and there’s a bankruptcy filing to follow.
Both sides have been swapping “term sheets” for several months now but have been unable to agree on a final plan for the restructure. What seems to be the goal is for iHeart to come out of the negotiations with about $5.75 billion in new debt as opposed to the $20 billion it has been unable to chip away at for several years. It’s also possible an agreement cannot be reached and the company has to file for bankruptcy.
iHeart skipped a $106 million interest payment on February 1 which set off a 30-day clock before a possible default. Just as that 30 days was about to expire, the two sides agreed to a 72-hour extension to continue to negotiate a deal. Another $138 million in interest payments also went unpaid by iHeart on March 1, setting off another 30-day clock on a possible default, as the two sides continued discussing a possible agreement to restructure iHeart’s debt.