Hungarian-born billionaire activist George Soros is poised to assume control of Audacy, the second-largest radio station chain in America.
Billionaire financier George Soros is set to take a controlling stake in the second-biggest radio company in America, after his investment firm snapped up a massive chunk of the radio firm’s debt that will be converted to stock after it exits bankruptcy.
Soros Fund Management, the investment firm founded by Mr. Soros, owns over $414 million of the highest-tier debt of Audacy Inc., a Philadelphia-based company that owns hundreds of radio stations, bankruptcy court filings show.
The Soros investment firm, which is listed alongside other Audacy lenders that are members of the “ad hoc first lien group,” is poised to have its debt converted into Audacy stock as part of a restructuring of the company.
Audacy filed for Chapter 11 bankruptcy protection earlier this year in order to reduce and restructure its $1.9 billion debt, converting most of it into stock.
“Through the restructuring, Audacy and its debtholders will undertake a deleveraging transaction to equitize approximately $1.6 billion of funded debt, a reduction of 80 percent from approximately $1.9 billion to approximately $350 million,” the company said in a Jan. 7 press release.
There were a number of critical reactions as word spread on social media that Mr. Soros’s investment firm is set to assume a major stake in America’s number two radio station chain.
The Hungarian-born billionaire activist is known for using his vast wealth to support various left-leaning causes.
‘Perfect Storm’
Under the restructuring plan, high-ranking creditors will be repaid in stock while lower-tier debtholders will be wiped out. Audacy expects final bankruptcy court approval of the plan at some point in February, followed by a green light from the Federal Communications Commission that will allow it to emerge from bankruptcy protection.
Audacy CEO David Field said a statement that the company’s troubles were the result of a “perfect storm of macroeconomic challenges” that hit the advertising market and led to a “sharp reduction of several billion dollars in cumulative radio ad spending.”
The stations in Audacy’s portfolio include New York’s WFAN and 1010 WINS, Los Angeles-based KROQ, as well as Boston stations WEEI, Mix 104.1, and Magic 106.7.
By Tom Ozimek
