Citadel Broadcasting Corp (CTDB.OB), the third largest U.S. radio broadcaster, plans to file for bankruptcy as soon as Sunday, the Wall Street Journal reported on Saturday.
Locally, both KGO radio and KSFO are owned by Citadel.
Citadel is expected to file in a deal supported by many lenders collectively owed $2 billion, known as a "prearranged" deal, the newspaper said, citing people familiar with the matter that it did not identify.
Those lenders plan to swap a big portion of their debt for equity in a reorganized Citadel, effectively handing them control, the Journal said.
Citadel officials could not be reached to comment.
The deal would reduce Citadel's debt load to about $762.5 million, the Journal said, citing the sources. The company will need to solicit more creditor support in court to get its reorganization plan approved by a judge.
Citadel's board approved the filing in recent days, the newspaper said.
Citadel CEO Farid Suleman will likely remain in charge after the company leaves Chapter 11 bankruptcy protection, the sources told the Journal.
UPDATE------------UPDATE: Citadel has formally filed for BK.
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