iHeartMedia is back on the up-and-up after filing for Chapter 11 protection in March. When the company emerges from bankruptcy next year, Clear Channel Outdoor Holdings Inc. will split from iHeart, each becoming their own independent company.
This separation will leave Clear Channel free of the cash demanding iHeart, which will come through the split as a leaner company. Both companies, however, will emerge from the deal as more attractive companies to potential buyers. iHeart will shed about $10.3 billion in debt, down from the $20 billion it began its bankruptcy with.
The new agreement between the two companies states CCOH will separate entirely from iHeartMedia, who holds 89.1% of CCOH common stock. Their separation is outlined in CCOH’s Form 8-K, filed with the Securities and Exchange Commission.
Leadership will adjust to the divide as well. After exiting bankruptcy, William Eccleshare will become the CEO of Clear Channel. He is currently the Chairman and CEO of Clear Channel International. He will continue to lead Clear Channel International in his new role, and will serve on the Board of Directors for CCOH.
Scott Wells will continue to lead Clear Channel Outdoor Americas as CEO, reporting to Eccleshare.
Bob Pittman, CEO of iHeartMedia explained the split as a strategic move,
“We believe that the separation of the two businesses makes strategic and financial sense, and will allow each company to better achieve their individual mission… although both businesses are powerful advertising platforms, they each have valuable but different touch points within the advertising community and pursuing separate, highly-targeted strategies will unlock their full potential as freestanding companies.”