Investment funds based in the Cayman Islands, Jersey, Ireland, and Japan are seeking approval to hold post-bankruptcy shares in Spanish Broadcasting System, as the FCC opens a pleading cycle to allow SBS’s foreign ownership to rise to majority stakes.
Radio Ink reported in May, when SBS formally filed for bankruptcy, that FCC approval of a foreign-ownership waiver was already flagged as a hard condition for the reorganization plan to take effect. Under the plan, SBS’s existing capital stock will be canceled, with noteholders receiving all the common stock in the reorganized company plus new secured notes.
SBS reports its pre-bankruptcy foreign ownership at 12.9% equity and 3.8% voting interest. Post-emergence, the company projects those figures will rise to 64.13% equity and 67.02% voting interest in the aggregate, well above the 25% threshold that normally triggers FCC review under Section 310(b)(4) of the Communications Act. SBS is asking the Commission to approve up to 100% aggregate foreign equity and voting interest in the company.
The foreign entities seeking specific approval to hold more than 5% of SBS include Cayman Islands-based Bardin Hill Opportunistic Credit Master Fund LP, at 8.1% equity and voting interest, and a chain of three affiliated Jersey-based Man Group entities, each listed as holding a 20% voting interest through the corporate structure. Ireland’s Mercer QIF Fund and Mercer Global Investments Europe are each listed near or at 5.11%. Japan’s Yuko Koach also sought specific approval despite falling under the ownership threshold, in order to also qualify for advance approval. All of the listed investors are seeking advance approval to increase their stakes up to a non-controlling 49.99% at a future date.
This isn’t SBS’s first foreign-ownership waiver. The FCC approved a similar declaratory ruling in 2023 allowing foreign investors to indirectly hold up to 49.99% of SBS equity in the aggregate, conditioned on the company’s compliance with a 2022 letter of agreement with the Department of Justice. SBS says it remains in compliance with that agreement and will continue to under the new petition.
Regulators also announced they will not formally refer the petition to Executive Branch national security reviewers, citing SBS’s existing compliance agreement, though the Commission will send the relevant agencies a courtesy copy of the notice and retains enforcement authority if SBS falls out of compliance.
SBS’s 20 radio stations span New York, Los Angeles, Miami, Chicago, Houston, Orlando, Tampa, San Francisco, and Puerto Rico, alongside two Miami-serving television stations.
Petitions to deny are due October 2, oppositions are due October 19, and replies are due October 26.
