Spanish Broadcasting System announced it intends to voluntarily file for Chapter 11 bankruptcy protection in the US Bankruptcy Court for the District of Delaware after reaching a Restructuring Support Agreement with a majority of debtholders.
SBS CEO Raúl Alarcón will retain his role and continue as chairman through consummation of the restructuring, after which a new board is expected to be elected by stockholders. Richard Lara has been promoted to Chief Operating Officer while continuing to serve as General Counsel.
SBS disclosed as far back as its second-quarter 2025 earnings that it lacked sufficient cash to repay the $310 million in notes and had no firm commitment for refinancing, triggering a going concern warning. Second-quarter net revenue fell to $34.44 million from $40.01 million a year earlier, and the company posted a net loss of $4.44 million against a $346,000 loss in Q2 2024. A $2.925 million non-cash impairment charge compounded the pressure. Cost-cutting showed results by Q3, but revenue continued sliding, dropping to $31.26 million from $35.76 million.
When the notes came due March 1, SBS failed to repay them. Holders representing a majority of the outstanding 9.750% Senior Secured Notes due 2026 agreed to a 30-day forbearance while both sides negotiated toward a resolution. That process culminated in the April 3 RSA.
The supporting investors, funds and accounts managed by Brigade Capital Management, LP, subsidiaries of Man Group plc, and Bayside Capital, LLC, collectively manage in excess of $330 billion in assets. Under the RSA, existing common and preferred stock would be cancelled. Noteholders would receive 100% of the common stock in the reorganized company, subject to equity issuances under a new management incentive plan and new secured notes issued by the reorganized entity.
SBS said the restructuring is expected to extend note maturities by more than four years and lower interest expense, with the company projecting greater flexibility to invest in local programming, talent, broadcast infrastructure, and its LaMúsica digital platform. The company said it expects to continue operating in the ordinary course through the process, including paying employee wages and benefits and honoring critical vendor payments.
The supporting investors have committed to provide debtor-in-possession financing, including backstop commitments, to cover liquidity needs during the Chapter 11 cases.
The RSA follows a forbearance agreement SBS entered with the supporting investors on March 6. The transactions remain subject to bankruptcy court approval, FCC approval, and other customary conditions. SBS operates 16 radio stations in New York, Florida, California, Illinois, and Puerto Rico and runs AIRE Radio Networks.
The filing lands against a backdrop of widening financial strain across US radio. Cumulus Media filed for Chapter 11 in the US Bankruptcy Court for the Southern District of Texas on March 5, entering a prepackaged restructuring support agreement backed by roughly 72% of its secured lenders to eliminate approximately $592 million in debt across more than 400 stations and the Westwood One network.
