Audacy: Prepack Restructuring Confirms with Ongoing Radio Asset Sales
Audacy Jan 2024 prepack confirmed quickly and went effective Sept 2024, alongside selected radio asset 363 sales.
Audacy’s prepackaged chapter 11 case combined fast confirmation with a long gap to emergence. The company filed for bankruptcy protection in the Southern District of Texas on January 7, 2024, after negotiating a restructuring that targeted a roughly 80% reduction in funded debt (to about $350 million from around $1.9 billion) through a debt-for-equity conversion.
The plan could not become effective until the FCC cleared transfers of control for broadcast licenses, pushing the effective date to September 30, 2024—more than seven months after Judge Christopher Lopez entered the Confirmation Order on February 20, 2024.
| Debtor(s) | Audacy, Inc., et al. (jointly administered) |
| Court | U.S. Bankruptcy Court, Southern District of Texas (Houston Division) |
| Case Number | 24-90004 (lead case) |
| Judge | Hon. Christopher M. Lopez |
| Petition Date | January 7, 2024 |
| Confirmation Date | February 20, 2024 |
| Effective Date | September 30, 2024 |
| DIP Facility | $32 million new-money term loan plus an increase in receivables financing capacity (reported as $25 million) |
| Funded Debt (reported) | ~$1.9 billion |
| Broadcast Footprint (reported) | ~235 owned radio stations across 48 markets |
| Post-Emergence Ownership (reported) | Private company controlled by creditor groups including Laurel Tree Opportunities Corporation and MBX Commercial Finance |
Business Profile and Distress Drivers
Business overview. Audacy entered chapter 11 as one of the largest U.S. radio broadcasters, with a footprint of about 235 stations across 48 markets. The company operated major-market brands that included stations such as KROQ, WFAN, and KCBS. While the legacy business remained terrestrial radio, the company marketed itself as an “audio” platform with a large podcasting and streaming presence.
Audacy’s modern corporate footprint traces to Entercom’s all-stock combination with CBS Radio in 2017, a deal that shifted the company into major markets and helped create the second-largest U.S. radio station owner. The company received FCC approval for the CBS Radio merger in November 2017 and later rebranded under the Audacy name in 2021. The chapter 11 filing came after a period in which the company’s equity value deteriorated; Audacy’s stock was delisted from the NYSE in November 2023.
Prepackaged restructuring. The filing was structured as a prepackaged bankruptcy, with Audacy reaching an agreement with a supermajority of debtholders on a balance sheet deleveraging transaction. The FCC approval vote was a 3-2 decision granted on September 18, 2024 and publicly released on September 30, 2024. The company was unable to emerge until license transfers were cleared.
Drivers of distress and the liquidity problem the plan was built to solve. Audacy's bankruptcy narrative mixed structural and cyclical pressures on radio advertising with a capital structure that required high cash interest expense. Management described macro conditions as a "perfect storm". The First Day Declaration described a shift in listening behavior since the pandemic and increased competition for advertising budgets from digital platforms, a picture echoed in the broader press coverage that pointed to sustained pressure on traditional ad spending.
The effects appeared both in operating results and in liquidity timing. Audacy's stock was delisted from the NYSE in November 2023, and the First Day Declaration described successive interest-payment grace periods in late 2023 as the company negotiated with creditor groups and sought time to implement a negotiated deleveraging transaction.
The company’s disclosed financial results in 2023 captured the strain. Audacy generated about $1.17 billion of net revenue in 2023, down 7% from 2022, and recorded a net loss that reflected large non-cash impairment charges on broadcast licenses. Separate reporting also referenced the $1.17 billion net revenue figure, framing it as a reflection of a challenging advertising market.
| 2023 net revenue (reported) | $1.17 billion |
| 2023 net loss (reported) | $1.14 billion |
| 2023 impairment loss on broadcasting licenses (reported) | $945.6 million |
| **2022 revenue ** | Approximately $1.3 billion |
| **2022 adjusted EBITDA ** | $137.9 million |
Capital Structure and DIP Financing
Capital structure at filing. The Final DIP Order described total funded debt at roughly $1.9 billion. The restructuring agreement targeted equitization of approximately $1.6 billion, cutting debt to about $350 million from around $1.9 billion.
| First lien term loans | $632.4 million |
| First lien revolving loans | $220.1 million |
| 6.750% senior secured second lien notes due 2027 | Not less than $460.0 million |
| 7.375% senior secured second lien notes due 2029 | Not less than $540.0 million |
DIP financing. Audacy filed with a financing package designed for a quick prepack, not a long stay in chapter 11. The DIP Motion described the filing-day liquidity commitment as about $57 million, split between a $32 million term loan and a $25 million increase in receivables financing capacity.
The DIP Motion described the term loan facility as a superpriority secured DIP without a roll-up, with pricing and fee terms calibrated to a short expected duration:
| Facility type | New-money DIP term loan |
| Commitment | $32.0 million |
| Pricing (SOFR option) | Adjusted Term SOFR + 6.00% |
| Pricing (base rate option) | Base rate + 5.00% |
| Commitment fee | 2.0% of commitments (payable at closing) |
| Backstop fee | 3.0% of commitments (payable at closing) |
| Early repayment premium (selected trigger) | 15.0% if repaid early in certain refinancing/sale/change-of-control scenarios |
The DIP milestones required an interim order within days, a final order within 45 days, plan confirmation within 45 days, and a target effective date within 60 days. The maturity was the earlier of multiple triggers, including a 60-day outside date, with an extension mechanism if regulatory approvals (including FCC approvals) were not yet satisfied.
Plan Structure, FCC Conditions, and Emergence
Plan structure. The transaction was characterized as an 80% reduction in funded debt, with post-emergence leverage of about 2.7x. The Chapter 11 Plan provided for an exit term loan facility capped at $250 million, split into first-out and second-out tranches, and a new equity structure with separate "Class A" and "Class B" common stock classes, plus "special warrants" and "new second lien warrants."
The bankruptcy court approved the plan at a February 20, 2024 hearing. The First Day Declaration described a restructuring support agreement supported by supermajority thresholds in both the first lien and second lien classes.
Exit term loan facility (first-out vs second-out). The exit debt structure was set up as a first-lien exit term loan facility with two internal tranches:
| Exit term loan facility cap (overall) | $250 million (total facility) |
| First-out exit term loans | Initial amount tied to outstanding DIP loans at effectiveness, capped at $25 million (subject to adjustment in some cash-balance scenarios) |
| Second-out exit term loans | $250 million minus the first-out amount (the “takeback” tranche allocated to first lien creditors) |
DIP lenders could elect to convert their claims into first-out exit term loans on a dollar-for-dollar basis.
Equity structure. The reorganized equity featured both Class A and Class B common stock. Class B shares were limited-voting shares designed to be non-attributable for FCC ownership rules, with a conversion feature into Class A stock subject to compliance with communications laws and FCC approvals.
Equity allocation. The plan described equity distribution pools for different creditor groups:
| First lien equity distribution (base pool) | 75% of new common stock on the effective date (with a potential increase up to 85% in a specified funding scenario) |
| DIP-to-exit equity distribution | 10% of new common stock on the effective date |
| Second lien equity distribution | 15% of new common stock on the effective date |
| New second lien warrants | Warrants exercisable for 17.5% of new common stock on a fully diluted basis (subject to communications law compliance) |
| Management incentive plan (reservation) | 10% of fully diluted new common stock reserved for equity-based awards within 120 days after the effective date |
The first lien and DIP equity pools were subject to dilution from the management incentive plan reserve and shares issued upon exercise of new second lien warrants.
Treatment by class.
| Class | Allowed amount | Treatment (high level) |
| First lien claims | $852.5 million (plus accrued amounts) | Second-out exit term loans and new equity distributions (subject to dilution mechanics) |
| Second lien notes claims | $1.0 billion (plus accrued amounts) | New equity distributions plus new second lien warrants (subject to exercise terms and communications law compliance) |
| General unsecured claims | Unimpaired | Payment in full under plan terms |
| Existing parent equity interests | Not entitled to vote | Non-voting notice and opt-out mechanics for third-party release; reorganized equity issued to creditor groups under the equity allocation framework |
New second lien warrants (selected terms). The Chapter 11 Plan described a warrant package for second lien noteholders. The warrants were exercisable (cash or cashless) for 17.5% of reorganized common stock on a fully diluted basis, with an exercise window of up to four years after the effective date and an exercise price set at an equity value of $771 million. The plan also described “Black-Scholes protection” for 15% of the warrant tranche for a two-year period after the effective date, with the remainder not receiving that protection.
General unsecured claims were treated as unimpaired.
Critical vendor program. The Critical Vendors Motion described a program with interim authority to pay certain prepetition trade claims up to $10 million and final authority up to $70 million.
| Trade category (as presented in bankruptcy filings) | Interim payment cap | Final payment cap |
| Programming providers | $2.9 million | $21.7 million |
| Sales and marketing vendors | $0.3 million | $12.9 million |
| Copyright intermediaries | $5.6 million | $27.9 million |
| Other trade creditors | $1.2 million | $7.5 million |
Releases, Asset Sales, and Post-Confirmation Administration
Releases. The Confirmation Order approved plan releases and exculpation provisions with the third-party release structured as a voluntary, opt-out construct.
FCC approvals. The FCC decision drew foreign ownership concerns, including discussion of a temporary waiver allowing emergence to proceed before certain foreign ownership declarations were filed, and the approval was characterized as controversial.
In August 2024, the debtors filed a DIP Forbearance Motion seeking forbearance and limited waivers tied to the DIP maturity date and effective-date milestones because FCC approval had not yet been obtained. The forbearance extended financing-related deadlines through September 30, 2024.
Asset sales. The docket includes discrete asset sales during the case, including two real estate transactions and a station divestiture necessary for FCC compliance.
| Asset | Terms |
|---|---|
| Needham, MA real estate | $3.5 million plus easement for continued tower-site use |
| Boston, MA real estate | Up to $18.12 million total consideration with ~two-year leaseback ($40,000/month base rent) |
| WSPA-FM station assets (Simpsonville, SC) | $700,000 purchase price; FCC ownership compliance divestiture |
Emergence, ownership, and the transition to private control. When FCC approvals cleared in late September 2024, Audacy emerged and ceased being a public company. The company emerged from bankruptcy as a private company controlled by creditor groups including Laurel Tree Opportunities Corporation and MBX Commercial Finance, and the transaction was described as reducing debt by about 80% to roughly $350 million. The Philadelphia Inquirer described the post-emergence ownership group as including Laurel Tree (reported as holding a controlling share position) and other large financial institutions as secondary investors, with CEO David Field continuing to lead the company after emergence.
Laurel Tree held more than 57% of reorganized Class A common stock. Soros Fund Management had previously acquired a large position in Audacy's debt.
Post-confirmation reporting. A Post-Confirmation Report for the quarter ended October 31, 2024 listed the following:
| Item | Current quarter | Cumulative approved total |
| Bankruptcy professional fees and expenses (debtor) | $5.46 million (approved) | $8.77 million |
| All professional fees and expenses (debtor & committees) | $5.46 million (approved) | $23.35 million |
| Total cash disbursements (post-confirmation transfers) | $0.56 million | $0.56 million |
The case’s final procedural endpoint arrived later. The chapter 11 case was closed by final decree in early 2025, described as the end of the last pieces of the proceeding a bit more than a year after the filing.
Key professionals. Latham & Watkins LLP served as lead bankruptcy counsel, with Porter Hedges LLP as co-counsel. FTI Consulting served as financial advisor, and PJT Partners served as investment banker.
Key Timeline
| January 7, 2024 | Audacy filed chapter 11 petitions with a prepack support deal and financing package described on filing day. |
| February 20, 2024 | The bankruptcy court approved the plan; Audacy announced court approval of its reorganization plan. |
| August 2024 | The debtors filed a DIP Forbearance Motion requesting financing forbearance and waiver relief tied to the DIP's maturity and effective-date milestones as the FCC review continued. |
| September 18, 2024 (approval) / September 30, 2024 (public release) | FCC approval of the restructuring in a 3-2 vote. |
| September 30, 2024 | Audacy emerged as a private company, aligning with the plan’s effective date. |
| January 2025 | Chapter 11 case closed by final decree. |
Frequently Asked Questions
When did Audacy file for chapter 11 bankruptcy?
Audacy filed for bankruptcy protection on January 7, 2024 in the U.S. Bankruptcy Court for the Southern District of Texas.
Was Audacy’s chapter 11 a prepackaged restructuring?
Yes. The filing was structured as a prepackaged bankruptcy, and Audacy said it reached a restructuring agreement with a supermajority of debtholders in a balance sheet deleveraging transaction.
How much debt was Audacy trying to eliminate through the restructuring?
The plan targeted a roughly 80% reduction in debt to about $350 million from around $1.9 billion. The post-emergence reporting similarly described the transaction as eliminating about $1.6 billion of debt.
What DIP financing did Audacy obtain, and what were the headline terms?
Lenders committed a $32 million new-money term loan plus a $25 million increase in receivables financing capacity. The DIP Motion described interest pricing structured as a SOFR-based or base-rate-based spread with up-front fees and milestone-linked maturity.
Why was there a long gap between plan confirmation and emergence?
Audacy could not emerge until the FCC approved transfers of control for broadcast licenses; emergence followed FCC approval in late September 2024.
Who owned Audacy after emergence (and did it remain public)?
Audacy emerged as a private company. The reorganized company was described as controlled by creditor groups including Laurel Tree Opportunities Corporation and MBX Commercial Finance.
When did Audacy’s chapter 11 case formally end?
The case was formally closed by final decree in early 2025.
Who is the claims agent for Audacy?
Epiq Corporate Restructuring, LLC serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.
Read more chapter 11 case research on the ElevenFlo blog.
