US radio broadcaster Citadel files for bankruptcy

Citadel Broadcasting Corporation (Citadel), the third-largest radio broadcasting group in the US, yesterday filed for bankruptcy, the company said in a press release.

The company has voluntarily filed for protection under Chapter 11 in the US bankruptcy court for the southern district of New York, covering its 50 units, the statement said. The broadcaster's liabilities stood at around $2.5 billion as at 30 September, while its total assets were approximately $1.4 billion.

Las Vegas, Nevada-based Citadel is the third largest radio group in the US, with a national footprint reaching more than 50 markets. It consists of 166 FM and 58 AM stations in the nation's leading markets, in addition to Citadel Media (formerly ABC Radio Networks) which is also owned by Citadel.

New York-based private equity firm Fortsmann Little & Co owns a 29-per cent stake in Citadel, Wells Fargo & Co another 5.1 per cent, while Citadel's board chairman and CEO Farid Suleman 3.1 per cent.

Over 60 per cent of the Citadel's secured debtors agreed to a pre-negotiated bankruptcy that would allow the company to extinguish around $1.4 billion of debts. The restructuring envisages conversion of Citadel's $2.1 billion credit facility to a new term loan in the principal amount of $762.5 million.

Farid Suleman said, ''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."