By Court Approval Granted
Radio and podcasting giant Audacy Inc. has successfully received court approval to emerge from bankruptcy, with George Soros’ investment fund positioned to become the company’s largest stakeholder. The U.S. Bankruptcy Court for the Southern District of Texas approved Audacy’s plan to exit the chapter 11 process, which was initiated by the company in January. Audacy is now waiting for the Federal Communications Commission’s approval to proceed with emerging from bankruptcy.
CEO’s Optimistic Statement
In response to the court’s decision, Chief Executive David J. Field expressed that the approval marks a significant step forward for Audacy. He emphasized that this milestone will enable the company to actively pursue its strategic goals and opportunities within the dynamic audio business landscape.
Debt Reduction Strategy
Audacy’s prepackaged restructuring plan aims to slash approximately 80% of its $1.9 billion debt, bringing it down to around $350 million. This reduction plan sets the stage for Audacy’s financial recovery post-bankruptcy.
George Soros’ Role
Recent court filings revealed that Soros Fund Management, headed by billionaire George Soros, had obtained roughly $415 million of Audacy’s first-lien debt. This development positions Soros as one of the primary creditors slated to receive payment in the restructured company’s equity post-bankruptcy. Bloomberg News reported last week that Soros’ investment fund is poised to become Audacy’s largest shareholder upon emergence.
Background and Challenges
Audacy accrued a substantial portion of its debt in the wake of its merger with CBS Radio in 2017. The company operates a network of over 200 radio stations throughout the U.S., including notable stations like WFAN, WINS in New York, KROQ in Los Angeles, and KCBS in San Francisco. Facing a confluence of enduring macroeconomic challenges, including a sharp decline in the advertising market, Audacy found itself embroiled in financial difficulties prompting the bankruptcy filing.
Market Performance and Recovery
Audacy shares were removed from the New York Stock Exchange in November and are now traded over-the-counter. While the stock plummeted by 97% over the past year, it witnessed a notable rally on Tuesday, surging by 44% to reach 20 cents—marking its highest level since early January.
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