• iHeart Media Might See Multiple Bidders

    Insider thought it might be time for a quick update on the iHeart Media bankruptcy proceedings so here is our latest take.

    Liberty Media, the majority owner of Sirius XM Holdings (NASDAQ SIRI), had a high level of interest looking to purchase a 40% interest in iHeartMedia for $1.16 Billion.  Liberty was also willing to finance working capital through Debtor In Possession (DIP) financing.  In the latter part of June, they withdrew that proposal after reviewing results which they said were below their expectations and negatively impacted their initial estimates of value.  Interestingly a New York Post article, indicated the Lender group rejected the offer stating that Liberty was not going to get iHeart at that price.  Leading iHeart creditors believe the company is worth between $12 billion and $15 billion.

    Last week a private equity investor, Silver Lake Partners, entered the mix beginning talks with creditors about taking over iHeartMedia once it emerges from bankruptcy.  Silver Lake is indicating they are interested in buying a controlling interest, which is more appealing to creditors.

    This week, Liberty Media is reportedly working on a revamp of its original offer and we should see something on that soon.  As to why negotiations are beginning to heat up,  iHeart has a goal to get court approval for a restructuring plan by Sept. 20 and could emerge from bankruptcy in early October.

    Insider’s Take – Liberty Media was looking for a bargain early, which the creditor group rightly rejected. We should see interest and values heat up as we get closer to a reorganization plan.  As to Clear Channel Outdoor, iHeart still plans to spin off or sell its 90% stake in Clear Channel Outdoor upon exit from bankruptcy.  We have heard nothing firm about any potential acquisitions for the CCO assets.

     

     


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