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Liberty Media Sets Sights on Struggling iHeartMedia
RADIO ONLINE | Tuesday, February 27, 2018 |
Liberty Media Corp., parent of SiriusXM, has set its sights on struggling iHeartMedia Inc., offering to inject $1.16 billion in cash into the radio broadcaster and its 850 radio outlets in return for 40% stake in the reorganized company following an eventual bankruptcy filing. Clear Channel Outdoor would be spun off as part of the proposed reorganization. The former Clear Channel has struggled under the burden of $20 billion in debt.
According to Variety, a term sheet submitted on February 23 by Liberty, which owns 69% of SiriusXM, the company would infuse $1.159 billion into a reorganized iHeartMedia acquiring 40% in new common shares, 20% to be held by SiriusXM and 20% by Liberty Media. The proposed restructure, which would include a new nine-member board to directors, of which Colorado-based Liberty would hold four seats, would be subject to approval of a Chapter 11 plan by all parties. The term sheet calls for "consummation" to be completed by December 21.
In March, 2017, iHeartMedia warned that it may be forced to declare bankruptcy if it cannot reach an agreement with its debtholders.
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