Beasley Media Group is continuing its financial pivot by becoming the second major radio company to offer a debt exchange plan to its creditors this year. The plan would extend Beasley’s debt maturity window by two additional years, if successful.
Through its subsidiary Beasley Mezzanine Holdings, LLC, Beasley has launched an exchange offer allowing current noteholders to swap their 8.625% Senior Secured Notes due 2026 for new 9.200% Senior Secured Notes due 2028, along with a share of Class A common stock and a consent fee.
Cumulus Media offered a similar program for their debt holders in Q1.
Under the terms of the exchange, noteholders will receive $950 in new notes for every $1,000 of old notes exchanged, shares in the company, and a $5 consent fee per $1,000 principal amount exchanged. A significant holder, controlling about 73% of the existing debt, supports this transaction which requires full participation from all existing noteholders.
In addition, Beasley has initiated a tender offer to purchase up to $68 million of the existing notes at 62.5% of their principal value, plus accrued interest. This offer is part of a larger refinancing strategy that includes issuing $30 million in new superpriority senior secured notes, which are backstopped by a majority of the existing noteholders.
This comes as the broadcaster plans a reverse stock split, approved by majority shareholder consent, at a ratio of anywhere from 1-for-5 to 1-for-20, to regain Nasdaq compliance. The exact ratio and timing are yet to be set by the Board of Directors. The earliest implementation could be late September.
Beasley reported a net loss of $276,021 in Q2 – a marked improvement over the previous year’s net loss of $10.4 million.
The changes are contingent on achieving the required majority consent from noteholders. The offers are scheduled to conclude on October 4, following the expiration of the consent and offer period on October 2.
CEO Caroline Beasley stated, “We are very pleased with the announcement of both the launch of this transaction and the support of a holder of approximately 73% of our outstanding indebtedness. We believe this transaction, when consummated, will provide meaningful long-term improvements to our balance sheet and provide value to debt holders and equity holders alike. This transaction is the product of several months of negotiations and represents a significant initial step forward in our long-term plan to reduce leverage and position the Company for future success.”
This story, in plain English, basically is Beasley saying “We can’t pay our bills. We need more time to do that.”
Not a good look for radio, to outsiders. Beasley can’t pay their bills. IHeart was, and Audacy now is, in bankruptcy. Cumulus, what’s left of that company thank you Lew Dickey, is just hanging on.
None of this speaks well about the industry.
The courts need to stop protecting these companies in bankruptcy.
Liquidate these companies. Get rid of these bloated, debt-saddled companies from a different era. Bring in new operators, dedicated to local radio.
Beasley E-sports was wild! They made stations air a show about people playing video games on their music stations. Made zero sense, and not sure 1 sponsor was ever sold. They still have 3 person morning shows where there’s 8-10 songs an hour being played…. as much as they cut and fire it’s strange that they also have bloated terrestrial area’s too. Can;t even buy a burger at McDonalds for the value of a share of their stock.