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iHeartMedia Enters into Transaction Support Agreement to Strengthen Balance Sheet

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iHeartMedia (NASDAQ: IHRT) has entered into a Transaction Support Agreement (TSA) with holders representing approximately 80% of its outstanding debt. The agreement outlines two alternative exchange transaction structures, both extending debt maturity by three years. The first structure involves issuing new secured debt, while the alternative involves newly-formed subsidiaries issuing secured debt against transferred assets. The company also amended its ABL facility to accommodate these transactions and modify certain covenants. This restructuring aims to strengthen iHeartMedia's financial position and provide additional flexibility for executing its business strategy.

iHeartMedia (NASDAQ: IHRT) ha stipulato un Accordo di Supporto alle Transazioni (TSA) con i detentori che rappresentano circa l'80% del suo debito in circolazione. L'accordo delinea due strutture alternative di transazione di scambio, entrambe con scadenza del debito estesa di tre anni. La prima struttura prevede l'emissione di nuovo debito garantito, mentre l'alternativa prevede che nuove filiali emettano debito garantito contro beni trasferiti. La società ha anche modificato il suo utilizzo di ABL per adattarsi a queste transazioni e modificare alcuni vincoli. Questa ristrutturazione mira a rafforzare la posizione finanziaria di iHeartMedia e fornire ulteriore flessibilità per l'esecuzione della sua strategia aziendale.

iHeartMedia (NASDAQ: IHRT) ha firmado un Acuerdo de Soporte de Transacciones (TSA) con tenedores que representan aproximadamente el 80% de su deuda pendiente. El acuerdo describe dos estructuras alternativas de transacción de intercambio, ambas extendiendo la madurez de la deuda por tres años. La primera estructura implica la emisión de nueva deuda garantizada, mientras que la alternativa implica que subsidiarias recién formadas emitan deuda garantizada contra activos transferidos. La empresa también modificó su instalación de ABL para acomodar estas transacciones y modificar ciertos convenios. Esta reestructuración tiene como objetivo fortalecer la posición financiera de iHeartMedia y proporcionar flexibilidad adicional para ejecutar su estrategia empresarial.

iHeartMedia (NASDAQ: IHRT)는 미 지분의 약 80%를 보유한 채권자들과 거래 지원 계약(TSA)을 체결했습니다. 이 계약은 두 가지 대안 교환 거래 구조를 설명하고 있으며, 모두 부채 만기를 3년 연장합니다. 첫 번째 구조는 새로운 담보 부채를 발행하는 것이고, 대안 구조는 신규 설립된 자회사가 이전된 자산에 대해 담보 부채를 발행하는 것입니다. 회사는 이러한 거래를 수용하고 특정 약정을 수정하기 위해 ABL 시설도 수정했습니다. 이 리스트럭처링은 iHeartMedia의 재무 상태를 강화하고 비즈니스 전략을 실행하는데 추가적인 유연성을 제공하는 것을 목표로 합니다.

iHeartMedia (NASDAQ: IHRT) a conclu un Accord de Soutien aux Transactions (TSA) avec des créanciers représentant environ 80 % de sa dette en circulation. L'accord décrit deux structures alternatives d'échange de transaction, toutes deux prolongeant l'échéance de la dette de trois ans. La première structure implique l'émission de nouvelles dettes sécurisées, tandis que l'alternative implique que des filiales nouvellement créées émettent des dettes sécurisées contre des actifs transférés. La société a également modifié son installation ABL pour s'adapter à ces transactions et modifier certains engagements. Cette restructuration vise à renforcer la position financière d'iHeartMedia et à fournir une flexibilité supplémentaire pour exécuter sa stratégie commerciale.

iHeartMedia (NASDAQ: IHRT) hat eine Transaktionssupportvereinbarung (TSA) mit Gläubigern getroffen, die etwa 80 % der ausstehenden Schulden vertreten. Die Vereinbarung umreißt zwei alternative Transaktionsstrukturen, die beide die Fälligkeit der Schulden um drei Jahre verlängern. Die erste Struktur umfasst die Emission neuer gesicherter Schulden, während die Alternative die neu gegründeten Tochtergesellschaften betrifft, die gesicherte Schulden gegen übertragene Vermögenswerte ausgeben. Das Unternehmen hat auch seine ABL-Fazilität geändert, um diese Transaktionen zu berücksichtigen und bestimmte Verpflichtungen zu modifizieren. Diese Umstrukturierung zielt darauf ab, die finanzielle Position von iHeartMedia zu stärken und zusätzliche Flexibilität für die Umsetzung seiner Geschäftsstrategie zu bieten.

Positive
  • Agreement secured with 80% of debt holders, indicating strong creditor support
  • Three-year extension of debt maturity provides improved financial flexibility
  • Successful restructuring would strengthen the company's balance sheet
Negative
  • Need for debt restructuring indicates potential financial distress
  • ABL facility amendment includes increased interest rate
  • Complex restructuring process with multiple conditions for completion

Insights

This debt restructuring agreement represents a significant financial maneuver for iHeartMedia. With 80% of debt holders already supporting the transaction, the company is positioning for a substantial balance sheet transformation. The proposed three-year maturity extension across multiple debt instruments provides important breathing room for operational execution.

The dual-structure approach is particularly noteworthy - offering either new secured debt directly from iHeartCommunications or through newly-formed subsidiaries holding specific assets. This flexibility demonstrates sophisticated financial engineering to accommodate various participation scenarios. The concurrent ABL facility amendment, while increasing interest costs, provides essential covenant modifications to facilitate the restructuring.

The high level of initial creditor support (77-92% across various debt tranches) suggests strong likelihood of successful execution, though the ultimate impact on the company's financial health will depend on final participation rates and the specific structure implemented.

This transaction marks a proactive approach to address iHeartMedia's debt maturity wall. The high initial creditor support levels, particularly the 92% backing from term loan holders, indicates strong market confidence in the restructuring plan. The dual-track exchange offer structure provides strategic optionality while ensuring the company can proceed with either high or lower participation scenarios.

The ABL amendment's higher interest rate reflects current market conditions and the complex nature of the restructuring. However, the covenant modifications and transaction flexibility gained likely outweigh the increased cost. This development should positively impact iHeartMedia's credit profile by extending maturities and providing operational flexibility, though investors should monitor the final participation rates and structure selection.

NEW YORK--(BUSINESS WIRE)-- iHeartMedia, Inc. (NASDAQ: IHRT) (“iHeartMedia” or the “Company”) today announced that it and certain of its subsidiaries (collectively with the Company, the “iHeartMedia Parties”) have entered into a Transaction Support Agreement (the “TSA”) with certain lenders and holders (or their managers, advisors or sub-advisors) (collectively, the “Initial Supporting Holders”) of iHeartCommunications, Inc.’s (“iHeartCommunications”) outstanding notes and term loans. The Initial Supporting Holders represent approximately 80% of the aggregate principal amount of the Existing Debt (as defined below), including approximately 77% of the aggregate principal amount of iHeartCommunications’ outstanding senior secured notes due 2026, 79% of the aggregate principal amount of its outstanding senior secured notes due 2027, 38% of the aggregate principal amount of its outstanding senior secured notes due 2028, 71% of the aggregate principal amount of its outstanding senior unsecured notes due 2027, and 92% of the aggregate principal amount of its outstanding term loans (all such notes and term loans outstanding collectively, the “Existing Debt”).

The iHeartMedia Parties and the Initial Supporting Holders have agreed to the terms of, and to support, (i) exchange offer transactions that will be offered to all holders of the Existing Debt, consisting of two alternative exchange transaction structures, each of which will extend the maturity of the Existing Debt tendered in the exchange offer transactions by three years, and (ii) concurrent consent solicitations to amend certain provisions in the indentures and credit agreement governing the Existing Debt. In the first transaction structure, if certain thresholds of holder participation are met, iHeartCommunications will issue new secured debt in exchange for the Existing Debt held by participating holders. Alternatively, if certain thresholds of holder participation are not met, newly-formed subsidiaries of the Company holding certain transferred assets and an intercompany note (to be issued by iHeartMedia + Entertainment, Inc.) will issue new secured debt in exchange for the Existing Debt held by participating holders. Completion of either exchange transaction will result in a strengthened financial position, providing iHeartMedia with additional flexibility to execute on its strategy and business initiatives.

Concurrently with entry into the TSA, the Company also entered into an amendment to its ABL facility (the “ABL Amendment”) to, among other things, permit both exchange transaction alternatives and other transactions related to the exchange, amend certain covenants and provisions and increase the interest rate. The amendments contained in the ABL Amendment will become effective upon the satisfaction or waiver of certain conditions, including the consummation of one of the transactions contemplated by the TSA.

iHeartMedia expects to commence the exchange offer in the near term.

The Company today filed a Form 8-K with the Securities and Exchange Commission, which contains further details regarding the terms of the TSA and the related transactions and a copy of the ABL Amendment. The foregoing descriptions of the TSA and the ABL Amendment do not purport to be complete and are qualified in their entirety by reference to the full text of the TSA and the ABL Amendment.

Simpson Thacher & Bartlett LLP served as counsel and PJT Partners served as financial advisor to the Company. Davis Polk & Wardwell LLP served as counsel and Perella Weinberg Partners served as financial advisor to an ad hoc group of certain of the Initial Supporting Holders.

This press release is not intended to be, and does not constitute, an offer to sell, buy or subscribe for any securities or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. In particular, this communication is not an offer of securities for sale into the United States or any other jurisdiction. No offer of securities shall be made absent registration under the Securities Act of 1933, as amended, or pursuant to an exemption from, or in a transaction not subject to, such registration requirements.

Certain statements herein constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors which may cause the actual results, performance or achievements of iHeartMedia, Inc. and its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The words or phrases "guidance," "believe," "expect," "anticipate," "will," "potential," "positioned," "estimates," "forecast," and words of similar meaning, as well as other words or expressions referencing future events, conditions or circumstances are intended to identify such forward-looking statements. These statements include, but are not limited to, statements related to the transactions described above, including the Company’s ability to complete any of the transactions on the terms contemplated by the TSA, on the timeline contemplated or at all, and the Company’s ability to realize the intended benefits of any such transactions. In addition, any statements that refer to expectations or other characterizations of future events or circumstances, such as statements about our anticipated growth and financial performance, our expected costs savings and other capital and operating expense reduction initiatives, utilizing new technologies and programmatic platforms, trends in the advertising industry, and strategies and initiatives are forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other important factors, some of which are beyond our control and are difficult to predict. Various risks that could cause future results to differ from those expressed by the forward-looking statements included in this press release include, but are not limited to: risks related to weak or uncertain global economic conditions and our dependence on advertising revenues; competition, including increased competition from alternative media platforms and technologies; dependence upon our brand and the performance of on-air talent, program hosts and management; fluctuations in operating costs; technological and industry changes and innovations; shifts in population and other demographics; risks related to our use of artificial intelligence, impact of acquisitions, dispositions and other strategic transactions; risks related to our indebtedness; legislative or regulatory requirements; impact of legislation, ongoing litigation or royalty audits on music licensing and royalties; regulations and concerns regarding privacy and data protection and breaches of information security measures; risks related to scrutiny of environmental, social and governance matters; risks related to our Class A common stock; and regulations impacting our business and the ownership of our securities. Other unknown or unpredictable factors also could have material adverse effects on the Company’s future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this press release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date hereof. Additional risks that could cause future results to differ from those expressed by any forward-looking statement are described in the Company’s reports filed with the U.S. Securities and Exchange Commission, including in the section entitled “Part I, Item 1A. Risk Factors” of iHeartMedia, Inc.’s Annual Reports on Form 10-K and “Part II, Item 1A. Risk Factors” of iHeartMedia, Inc.’s Quarterly Reports on Form 10-Q. The Company does not undertake any obligation to publicly update or revise any forward-looking statements because of new information, future events or otherwise.

About iHeartMedia, Inc.

iHeartMedia, Inc. [Nasdaq: IHRT] is the leading audio media company in America, reaching over 90% of Americans every month. iHeart’s broadcast radio assets alone have more consumer reach in the U.S. than any other media outlet; twice the reach of the next largest broadcast radio company; and over four times the ad-enabled reach of the largest digital only audio service. iHeart is the largest podcast publisher according to Podtrac, with more downloads than the next two podcast publishers combined and has the number one social footprint among audio players, with seven times more followers than the next audio media brand, and the only fully integrated audio ad tech solution across broadcast, streaming and podcasts. The company continues to leverage its strong audience connection and unparalleled consumer reach to build new platforms, products and services.

Media

Wendy Goldberg

Chief Communications Officer

(212) 377-1105

wendygoldberg@iheartmedia.com

Investors

Mike McGuinness

EVP, Deputy CFO, and Head of Investor Relations

(212) 377-1336

mbm@iheartmedia.com

Source: iHeartMedia, Inc.

FAQ

What is the purpose of iHeartMedia's (IHRT) Transaction Support Agreement?

The TSA aims to strengthen iHeartMedia's balance sheet by extending debt maturity by three years through exchange offer transactions and providing additional financial flexibility.

What percentage of debt holders support iHeartMedia's (IHRT) restructuring plan?

Approximately 80% of the aggregate principal amount of existing debt holders support the Transaction Support Agreement.

What are the two transaction structures proposed in iHeartMedia's (IHRT) TSA?

The first structure involves issuing new secured debt, while the alternative involves newly-formed subsidiaries issuing secured debt against transferred assets, both extending debt maturity by three years.

iHeartMedia, Inc.

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