iHeartMedia said it is continuing negotiations on its proposed debt-to-equity swap with bondholders, and so have moved back the deadline to June 9. It said it is also continuing discussions with the lenders of two term loans until that date.
iHeart is proposing to swap equity in its publicly-traded Clear Channel Outdoor Holdings in exchange for debt holders agreeing to forgive anywhere from 10-25 percent of $14 billion in debt -- $8 billion in debentures and $6 billion in two term loans -- and to swap the debt for new debenture that expire two years later, and pay lower interest rates.
So far, the debt holders have turned up their noses at the offer, and are waiting for iHeart to concede additional sweeteners to the deal. iHeart initially made its first proposal on March 15, setting an April 5 deadline. But the deadline has been postponed four times subsequently to April 28, then to May 12, followed by May 26 and now June 9.
Along the way the deal was sweetened slightly twice, and when those enticements didn't work, iHeart pointed out that it would have a going-concern issue, i.e. it was in danger of defaulting on its debt and would probably have to file for Chapter 11 in the next year, if something wasn't done to restructure its debt or generate additional cash. As of May 26, the previous deadline, $47.1 million of existing notes, or 0.6 percent of $8 billion in debentures included in the proposed deal, had been tendered for the exchange offer.
Stay tuned...
