The nation’s biggest owner of radio stations has repurchased and cancelled all of its outstanding shares of Series A Perpetual Preferred Stock. To do so, it used cash on hand, wiping 60,000 outstanding shares out of existence.
It is officially iHeartMedia Inc. subsidiary iHeart Operations Inc. that made the move, one that sees the audio content and distribution company behind iHeartRadio voluntarily repurchase the full balance of its $60 million preferred stock.
According to iHeartMedia Chairman/CEO Bob Pittman, it demonstrates the company’s commitment to strengthening its balance sheet and increasing free cash flow, while still maintaining “ample liquidity.”
Pittman added, “Repurchasing early allows us to realize interest savings, exit the most restrictive instrument on our balance sheet, and continue to reinforce iHeart’s commitment to improving our capital structure. This action continues to demonstrate our confidence in our business moving forward.”
The cash repurchase price for each Series A Perpetual Preferred Stock is $1,000, plus a premium equal to the remaining dividends required to be paid through the optional redemption date of May 1, 2022 — discounted at a negotiated rate. This results in an aggregate redemption amount of $64.35 million to be paid to the holders of the $60 million Series A Perpetual Preferred Stock.
On word of the repurchase, IHRT shares were up 22 cents to $19.81 in after-hours trading on Wednesday.