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Audacy bankruptcy plan gets federal court’s approval

The Audacy streaming radio app appears on a smartphone. (Photo by Focal Foto, Creative Commons; Graphic by The Desk)
The Audacy streaming radio app appears on a smartphone. (Photo by Focal Foto, Creative Commons; Graphic by The Desk)

A federal judge in Texas has signed off on Audacy’s plan to restructure a majority of its debt, a move that will allow the radio broadcast giant to emerge from Chapter 11 bankruptcy in the near future.

As part of the plan, Audacy will divvy up around $1.6 billion in debt among its creditors, bringing its overall debt load from $1.9 billion to a more-manageable $350 million.

The plan will also see a George Soros-backed investment fund acquire around $400 million in debt, which the group will swap for stock in Audacy, as reported by The Desk and other publications last week.

“Today’s announcement marks a powerful step forward for Audacy, positioning the Company for an exciting future,” David Field, the Chairman and CEO of Audacy, said in a statement on Tuesday. “As expected, we have achieved a speedy confirmation of our prepackaged plan, which will enable Audacy to pursue our strategic goals and opportunities in the dynamic audio business.”

The bankruptcy plan is still subject to approval from the Federal Communications Commission (FCC), where it is expected to meet little resistance. Once approved by all relevant regulators, Field says the plan will allow Audacy ” to drive accelerated growth and financial performance, capitalizing on our scaled, leadership position, our uniquely differentiated premium audio content and the robust capital structure that we will have upon emergence.”

Audacy is one of the largest independent owners of licensed commercial AM and FM radio stations in the United States. It also owns several podcast studios and operates a streaming audio business formerly known as Radio.com.

The company has been saddled with debt following its blockbuster merger with CBS Radio in 2017, when Audacy was still known as Entercom. The acquisition of CBS Radio allowed Audacy to further assert its dominance in the broadcast space, but its scale was not enough to overcome headwinds in the advertising market brought on by the coronavirus pandemic in 2020 and an ongoing shift among consumers who moved away from traditional radio toward streaming audio platforms.

Last May, Audacy was kicked off the New York Stock Exchange (NYSE) after failing to meet a crucial $1-per-share price threshold for several weeks. The company approved a reverse stock split to regain NYSE compliance, only to find its stock price again fall below $1 per share a short time later. The company filed for Chapter 11 bankruptcy protection in January.

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About the Author:

Matthew Keys

Matthew Keys is a nationally-recognized, award-winning journalist who has covered the business of media, technology, radio and television for more than 10 years. He is the publisher of The Desk and contributes to Know Techie, Digital Content Next and StreamTV Insider. He previously worked for Thomson Reuters, the Walt Disney Company, McNaughton Newspapers and Tribune Broadcasting.
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