Broadcasting company Audacy, a major player in the radio and podcast industry, revealed its Chapter 11 bankruptcy protection filing in Texas as part of a strategic move to lessen its debt.
Through the filing, the company anticipates a substantial 80% reduction in its total debt, bringing it down from approx. $1.9 billion to around $350 million with an added $57 million in debtor-in-possession ("DIP") financing.
Additionally, while daily operations remain unaffected in light of the filing, the move will erase existing shareholders' positions, transferring ownership to bondholders.
CEO David Field emphasized the company's evolution into a "leading, scaled multi-platform audio content and entertainment company” over recent years.
However, Field also acknowledged the challenges faced by Audacy in recent years, saying that "the perfect storm of sustained macroeconomic challenges over the past four years facing the traditional advertising market has led to a sharp reduction of several billion dollars in cumulative radio ad spending."
"These market factors have severely impacted our financial condition and necessitated our balance sheet restructuring," the CEO added.
Based in Philadelphia, Audacy (formerly known as Entercom) is recognized for its ownership of numerous radio stations, including WFAN Sports Radio, New York's 1010 WINS and KCBS, making it one of the leading radio broadcasters in the U.S.
Despite multiple ownerships, the broadcast giant faced challenges in the changing radio landscape, marked by streaming's impact and declining ad revenue.
With an unsustainable debt nearing $2 billion, Audacy's stock price plummeted, leading to its November delisting from the New York Stock Exchange (NYSE).
Audacy reported a third-quarter loss of $234 million last year and negative funds from operations of $83 million for the first nine months of 2023.