ShareThis
Regent Communications Inc. (RGCI), a Cincinnati radio broadcaster, filed for bankruptcy protection Monday with plans to slash its debt by $87 million and hand the majority of its new equity to hedge fund Oaktree Capital Management LP.
The company said in a statement Monday that it made the move after reaching an agreement in principal with its lenders for a financial restructuring.
As part of the agreement, current senior debt holders will convert their holdings into new shares of the reorganized company and provide Regent with new debt. According to court papers, the new debt will consist of $95 million in senior secured term loans plus $25 million in payment-in-kind, or PIK, loans.
Regent listed $166.5 million in assets and $211.3 million in debts in its bankruptcy petition filed with the U.S. Bankruptcy Court in Wilmington, Del.
Regent’s existing unsecured debt holders, namely lenders with deficiency claims against the company will waive those claims. All other unsecured claims will be paid in full with cash.
Meanwhile, secured lenders will give to current shareholders a “gift,” or a distribution from their collateral, of $5.5 million. Once that amount is distributed, Regent’s outstanding shares will be canceled.
Regent’s agreement with the lenders will be incorporated into a Chapter 11 plan, which will be subject to bankruptcy-court approval.
Read the full article and get updates from court papers at this Wall Street Journal link.
