Advertising revenue plummets, US broadcasting giant Audacy applies for bankruptcy protection to reduce 80% of its debt
Audacy, the American broadcasting and podcasting giant, announced last Sunday that it has filed for bankruptcy protection in Texas to reduce its debt. The restructuring agreement will reduce Audacy's total debt by 80%, to approximately $350 million. The company expects the restructuring to have no impact on its operations and assures that the transactions and other unsecured creditors will not be harmed. Audacy owns hundreds of radio stations and is one of the top broadcasting companies in the United States. Due to weak advertising revenue, the company has recently faced difficulties.
Zhitong App learned that Audacy (AUDA.US), the American broadcasting and podcasting giant, announced last Sunday that the company has filed for bankruptcy protection in Texas to reduce its debt. The company stated that the restructuring agreement will reduce Audacy's total debt burden by approximately 80% from around $1.9 billion to approximately $350 million.
David J. Field, President and CEO of Audacy, stated in a statement, "Over the past four years, the traditional advertising market has faced ongoing macroeconomic challenges, resulting in a cumulative decrease of billions of dollars in radio advertising spending. These market factors have severely impacted our financial condition, making it necessary for us to restructure our balance sheet."
Audacy stated that the restructuring agreement has been approved by the "vast majority" of its creditors, allowing it to file for a so-called "pre-packaged bankruptcy" application, which may help expedite the court process. The company stated that it expects the restructuring to have no impact on its operations and that its trade and other unsecured creditors will not be harmed.
In the application submitted to the Southern District of Texas Bankruptcy Court, Audacy listed its total debt at $2.66 billion and total assets at $2.79 billion.
The company stated that certain existing lenders have committed to provide $57 million in debtor-in-possession financing, which will help provide funding for operations during the restructuring process.
Audacy noted that its common stock will continue to trade over-the-counter (OTC) under the ticker symbol "AUDA" until the completion of the Chapter 11 bankruptcy proceedings.
It is understood that this Philadelphia-based company owns hundreds of radio stations and is one of the top broadcasting companies in the United States. Audacy owns WFAN Sports Radio, New York's 1010 WINS, and California's KCBS.
S&P Global Ratings previously stated in a report downgrading Audacy's credit rating in May last year that the company has been facing difficulties due to the continued weakness in radio advertising revenue.