Citadel Broadcasting Files For Bankruptcy Protection
Citadel Broadcasting Corp, the third-largest U.S. radio broadcaster, said on Sunday it filed for the bankruptcy protection, as the radio industry continues to be hard hit by depressed advertising revenue.
Citadel, which owns and operates 224 stations across the country, listed assets of about $1.4 billion and more than $2.4 billion in debt.
The company, like many print and broadcast media outfits, faces stiff competition, shifts in consumer habits and a harsh advertising climate.
Overall advertising revenue for radio companies is expected to drop 19% this year, according to consulting firm BIA/Kelsey. But Citadel's failure could be an inflection point for the broadcasting business. Signs have emerged in recent weeks that advertising is coming back, and BIA/Kelsey expects radio ad revenue to inch up 1.5% next year.
The filing by the company, which owns 224 stations across the country and syndicates Don Imus’s radio show, was not unexpected but does reflect the troubles plaguing the radio industry amid steep declines in advertising revenue and big debt loads.
“We are pleased with the support from the majority of our senior lenders, and we look forward to working with the remaining senior lenders and other stakeholders to ensure a complete and expeditious restructuring,” Farid Suleman, Citadel’s chief executive, said in a statement. “Our business will continue as usual and the company will work to emerge from the restructuring process as quickly as possible.”
Citadel, which employs some 4,200 people, began seeking suitors to buy the company or third-party investors several months ago, according to court documents.
Citadel received some interest but ultimately decided a balance-sheet restructuring would provide better value.
In recent months, Citadel hired law firm Kirkland & Ellis LLP and investment bank Lazard Ltd. for restructuring advice. It has also tapped turnaround firm Alvarez & Marsal.
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