Citadel Offers Deal To Lenders, FCC Rules Hold It Up
September 18, 2009 at 4:35 AM (PT)
CITADEL BROADCASTING, facing a $2 million interest payment due WEDNESDAY, offered its senior lenders a swap of some of its equity in exchange for "a big chunk of debt," but a deal is being held up because of FCC ownership rule concerns, according to a report in the WALL STREET JOURNAL.
The offer to lenders including J.P. MORGAN CHASE, GE CAPITAL, and ING GROEP NV, has been "slowed" in recent days by the complex FCC rules governing ownership transfers, which may block deals because the lenders may end up with equity in too many stations in a single market or may run afoul of cross-ownership rules, the JOURNAL reports.
J.P. MORGAN CHASE, the JOURNAL notes, might face overlapping media ownership with CITADEL properties due to its previous deals to take equity in JOURNAL REGISTER CO. newspapers and FREEDOM COMMUNICATIONS newspapers and TV stations, and may face further overlapping if it ends up with stock in bankrupt TRIBUNE CO.
News of the deal offer comes as rumors about CITADEL's operations continue to swirl, including possible sales or closing of some assets.