Spanish Broadcasting System Inc. announced it has filed for Chapter 11 bankruptcy protection on Monday after the company reached an agreement to transfer ownership to noteholders as part of a debt restructuring plan. The move follows a pact reached in early April with a group of bondholders that will become the companys new owners under the terms of the restructuring.
The bondholders named in the agreement include Brigade Capital Management, Man Group and an affiliate of HIG Capital. Those parties collectively hold 72% of Spanish Broadcasting Systems $310 million in outstanding notes, according to the companys disclosures.
In its Chapter 11 petition filed in Delaware, the company reported that both its assets and its liabilities fall within the range of $100 million to $500 million. The filing frames the bankruptcy as part of a plan to reorganize the companys capital structure and effect the ownership transfer to its creditors.
Recent financial information supplied in a December regulatory filing shows revenue declined for the quarter. For the three months ending Dec. 31, Spanish Broadcasting System reported revenue of $31.3 million, down from $35.8 million in the same period the prior year.
The company, which serves the U.S. Hispanic population, has encountered difficulties disposing of its television assets, collectively referred to as MegaTV. A previously attempted sale process collapsed in 2023 and the company has since sought alternatives. As part of asset dispositions, Spanish Broadcasting System sold a television station in Puerto Rico in August for $5.7 million.
The filing and the agreed transfer to noteholders will be carried out under Chapter 11 procedures in Delaware. The companys agreement with the principal bondholders envisions a restructuring that will materially alter equity ownership by converting creditor claims into ownership stakes as part of the debt-for-equity swap embedded in the plan.
As the reorganization proceeds, regulatory filings and the bankruptcy petition provide the primary public record of the companys recent results and the terms of the creditor agreement. Observers and stakeholders will monitor subsequent court filings and creditor votes to track how the proposed ownership transfer and restructuring are implemented.