Much has been written since the $26.7 billion leveraged buyout by Thomas H. Lee Partners and Bain Capital in 2007 about the huge debt load at Clear Channel Communications. A recent decision by Standard & Poor’s to change its outlook for Clear Channel and parent CC Media Holdings to “negative” from “positive” noted the refinancing risk of big debt maturities in 2014 and 2016. But just what comes due when?
We found the answer in a comprehensive list of high-yield media bonds included in a research report by analysts Bishop Cheen and Davis Hebert at Wells Fargo Securities. The chart also showed the year-to-date returns on the bonds for investors, but for our purposes we’ll focus on the maturities and amounts. Suffice it to say that the YTD returns for the public bonds were mostly negative numbers, although a couple of CC issues were in positive territory as of December 14th. All, of course, carry junk bond ratings from the credit agencies.
Here are the debt securities coming due for CC Media Holdings from next March through October 2027.
|Term Loan A||LIBOR+340||7/30/2014||1,087|
|Term Loan B||LIBOR+365||1/29/2016||8,736|
|Sr. PIK Toggle Notes||11.000%||8/1/2016||830|
|Sr. Notes (guaranteed)||10.750%||8/1/2016||796|
|1st Priority Sr. Notes||9.000%||3/1/2021||1,000|
|1st Priority Sr. Notes||9.000%||3/1/2021||750|
|Sr. Secured Notes||9.000%||3/1/2021||1,750|
In addition, majority-owned subsidiary Clear Channel Outdoor has $2.5 billion of 9.250% Sr. Notes (in two issues of $2 billion and $500 million) that come due December 15, 2017. Those have better credit ratings, but are still in high-yield (junk bond) territory.
RBR-TVBR observation: Maybe this will make you feel better when the credit card bills come in from your holiday shopping.