iHeartMedia files for an IPO

iHeartMedia is the nations largest radio broadcaster and they have decided to go public with  an initial $100 million offering. This is coming off of the bankruptcy that they filed last year, because they accumulated too much debt. So it shouldn't be surprising to anyone that they have decided to go public, because they can no longer raise capital through bonds or loans.

iHeartMedia plans to use the funds from the IPO, if there is enough demand for the stock, to pay off a significant portion of its liabilities. They already had their bankruptcy restructuring plan approved by the courts, and this wiped $10 billion in debt off the balance sheet. However, the company is now controlled by the companies lenders and bondholders, because their debt does not just magically disappear without any consequences. So we can expect to see some potentially big changes to iHeartMedia due to the transfer of ownership. 

This applies to our marketing class, because iHeartMedia has to find a way to reduce their liabilities. If the company does not perform on the bottom line after the IPO, then the stock price will decrease and put them even further in the negative. iHeartMedia has over 800 radio stations, so it has the assets and the ability to market themselves to a wide range of people across the country. There is no doubt that the management of iHeart will be under extreme pressure to perform in the near future after the IPO. 

Nikolos Oakes

Article Title: Poised to Exit Bankruptcy, iHeartMedia files for an IPO

Article Link: https://www.wsj.com/articles/poised-to-exit-bankruptcy-iheartmedia-files-for-an-ipo-11554322784

Photo Link: https://www.lifewire.com/iheartradio-review-1357064

5:16 PM