CINCINNATI -- Regent Communications, the parent company of four radio stations in the Utica-Rome market, has filed for a "prearranged" Chapter 11 bankruptcy in order to eliminate $87 million in debt.
A press release issued by Regent explains there's little reason for employees or vendors to worry:
As part of the agreement, current senior debt-holders will convert their holdings into a new series of equity in the Company, while current public equity shareholders will receive approximately 12.8 cents for each share they own.
The restructuring process will have no impact on Regent's day-to-day operations and will not result in any changes to senior leadership. In addition, the Company has a current cash position of approximately $11 million, giving it ample liquidity and sufficient funds to pay all of its vendors and employees.
After giving effect to the restructuring, certain funds managed by Oaktree Capital Management, L.P., a premier global alternative and non-traditional investment manager, will own a majority of the new equity in the Company.
As of 10:20am, Regent Stock (RGCI.PK, Yahoo! Finance) is trading at 13 cents, down a nickel since today's open. The company has been trading stock over-the-counter since January 8, when it was delisted by Nasdaq for failing to meet minimum closing price requirements. The stock's 52-week high is 82 cents; Nasdaq's minimum listing price is $1.00 per share. Regent was first threatened with delisting by Nasdaq in August 2008, but the company had been granted extensions while it tried to revive the stock.
Regent hasn't been alone in this situation. Among other radio owners facing economic hardship, Citadel Broadcasting, owner of four Syracuse radio stations, was first threatened with delisting from the New York Stock Exchange just a month after Regent was threatened by Nasdaq. Citadel filed its own prearranged Chapter 11 bankruptcy this past December.
Similar to what happened at Citadel, a "prearranged" Chapter 11 at Regent will allow daily operations to continue smoothly because the company and all its debtors are in agreement as to how the company will proceed, avoiding lengthy (and costly) proceedings in bankruptcy court.
In the Utica-Rome market, Regent owns country Big Frog 104 (WFRG), adult contemporary Lite 98.7 (WLZW), classic hits Oldiez 96 (WODZ) and Newsradio 950 WIBX.
CNYRadio.com Editor Peter Naughton has been a part-time weekend host at Lite 98.7 (WLZW) since November 2009. From that point forward, it has been the site's policy to include a disclosure statement for any news coverage involving Regent Communications.