In a move reverberating through the Boston airwaves, Audacy, a giant in the radio broadcasting scene has filed for Chapter 11 bankruptcy to get a grip on its heavy debt load, reportedly leveraging a restructuring scheme to chop its massive $1.9 billion debt down by nearly 80% to $350 million. The prepackaged bankruptcy proceedings, as the company termed them, were launched in the United States Bankruptcy Court for the Southern District of Texas.
This decision comes on the heels of a "perfect storm of sustained macroeconomic challenges" that have persisted for the past four years, eating away at the traditional advertising market and thus reducing radio ad spending by several billion dollars leaving the company scrambling to address its financial straits. As David J. Field, Audacy's Chairman, President, and CEO put it, "These market factors have severely impacted our financial condition and necessitated our balance sheet restructuring", according to Boston 25 News.
Some of Audacy's well-known Boston properties, which include WEEI, Mix 104.1, Big 103, and Magic 106.7, now operate under the shadow of bankruptcy, although the immediate impact on their operations remains unclear. The company, which prides itself on being one of the largest in the country's radio broadcasting industry as well as owning a sizeable podcast studio, suggested the reorganization will allow it to keep pushing forward with its digital initiatives and focus on its exclusive, high-grade audio content.
Fields emphasized optimism about Audacy's future despite the financial upheaval, he said, "With our scaled leadership position, our uniquely differentiated premium audio content and a robust capital structure, we believe Audacy will emerge well positioned to continue its innovation and growth in the dynamic audio business." The company, a mainstay that began in 1968, assured its stakeholders, including advertisers and listeners that business would carry on as usual throughout the tumult of the financial reorganization, as cited by CBS News Boston.
The filing casts yet another spotlight on the ongoing turbulence in the media landscape as traditional broadcast models feel the pressure from shifting ad dollars and consumer preferences. Audacy stocks, which were previously taken off the New York Stock Exchange in November of the preceding year, will be traded over-the-counter under the symbol "AUDA" for the duration of the Chapter 11 process before likely being canceled according to the restructuring plan.
