On Wednesday, March 15, iHeartCommunications engaged in a somewhat complex series of private offers to its bondholders.
The over-arching entity for publicly traded iHeartMedia and CC Outdoor Holdings initiated a plan that would effectively see a note swap … and a possible separation of iHeartMedia and CC Outdoor into two fully distinct and independently owned-and-operated companies.
Specifically, holders of its “Five Series of Priority Guarantee Notes” and its Senior Notes Due 2021 were called on to turn in those notes, and exchange them for new securities in connection with “a proposed global restructuring of its indebtedness.”
How’s that going? Not so good.
iHeart on Thursday morning (5/25) announced that it’s extending once again the private exchange offers.
The exchange offers and the consent solicitations for each issue of existing notes were originally set to expire at 5pm Eastern on April 14. Extensions moved that date to May 26.
Now, the expiration is set for 5pm Eastern on June 9 for both the exchange offers and consent solicitations, and for the withdrawal of tendered existing notes in the exchange offers and the revocation of consents in the consent solicitations.
Why has iHeart extended the expiry date by nearly two months?
The company is continuing discussions with note holders regarding the terms of the exchange offers, iHeart says.
It’s also still in discussions with lenders under its Term Loan D and Term Loan E facilities.
Those discussions don’t appear to be going in iHeart’s favor. As of 5pm Wednesday (5/24), an aggregate amount of approximately $47.1 million of the existing notes had been tendered into the exchange offers.
Translation: Just 0.6% of the outstanding existing notes had been tendered some five weeks after the initial expiration date.
What will come of the ongoing discussions is paramount to iHeart’s success in completing the exchange offers and consent solicitations, which have not been amended.
With no changes to the plan set for on April 14, will bondholders eventually capitulate, or will iHeart have no choices but to sweeten the offer if not abandon it altogether?
Share of IHRT, which trades on the OTC Pink Sheet, are unchanged at $2.15 as of 12:35pm Eastern on Thursday.