Late Wednesday night, radio conglomerate iHeartMedia filed for Chapter 11 bankruptcy protection to mitigate its overwhelming debt, according to Variety. The bankruptcy is joined by a plan to ease their debt load through negotiations with creditors.
“The agreement we announced today is a significant accomplishment, as it allows us to definitively address the more than $20 billion in debt that has burdened our capital structure,” CEO Bob Pittman said in a statement. “Achieving a capital structure that finally matches our impressive operating business will further enhance iHeartMedia’s position as America’s #1 audio company.”
iHeartRadio is the largest radio company in the country, controlling more than 850 stations in addition to a music streaming service, a live concert venture, and a 90 percent stake in Clear Channel Outdoor, a billboard company. The conglomerate has been debt-burdened for years, stemming from a 2008 buyout of Clear Channel Outdoor. iHeart currently employs 17,000 people worldwide, according to Fortune.
The company has also struggled in part because of declining ad sales and falling revenue as it competes with streaming companies like Pandora and Spotify, which went public in January. iHeart has reached an agreement with a number of key investors that hold more than $10 billion of its debt, and while the bankruptcy is serious, it is still unlikely to have much of an effect on the day-to-day operations of the company or its many radio stations. The news comes as Spotify gets ready for a $1 billion listing on the New York Stock Exchange, according to CNN.