Sen. Ted Cruz is pressing the FCC not to “rubber stamp” Audacy’s Chapter 11 reorganization.
Soros Fund Management would become the largest shareholder in the big media company after Audacy emerges from bankruptcy in a plan already approved by a federal court.
Cruz and other conservatives have expressed concern over what he called “George Soros’s takeover of Audacy’s nationwide radio network.” Businessman and philanthropist Soros is known for his left-leaning political orientation.
Audacy owns about 225 radio stations along with its many digital media assets. The reorganized company would exceed the limit under which no station license can be held by a corporation that exceeds 25% foreign ownership. Audacy has asked the FCC to waive the restriction.
[Related: “Audacy Prepares to Emerge From Chapter 11 Bankrupty”
Cruz, ranking minority member of the Senate Commerce Committee, wrote this week to fellow Republicans on the FCC, asking them to insist that the transaction be reviewed by the full commission. He believes Chairwoman Jessica Rosenworcel is not planning to hold a full vote but intends to direct the Media Bureau to issue an order “under the guise of delegated authority.”
He and other Republicans have argued that any order transferring Audacy’s licenses should be vetted and voted on by the full commission — “not rubber-stamped by unaccountable bureaucrats,” as Cruz’s office put it in the announcement.
Cruz said the issue is important given the number of stations involved, the fact that foreign entities will hold substantial ownership interests and the timing ahead of a presidential election.
Cruz’s office says the Democrats on the commission have “dodged” his “basic procedural request that they insist on a commission-level vote and indicated they were eager to avoid accountability and allow the matter to be resolved by bureaucratic fiat at the will of FCC Chairwoman Jessica Rosenworcel.” Now he’s calling on the two Republicans, Brendan Carr and Nathan Simington, to press his case with their colleagues.
Carr himself wrote on X this summer, “The FCC should not be waiving federal rules to create a special Soros shortcut.”
Audacy has said it expects FCC approval of the reorganization plan by the end of September. The company hopes to shed 80% of its heavy debt by exchanging debt for equity.
Financial results
Separately, as it awaits FCC approval of the Chapter 11 reorganization, Audacy Inc. reported second-quarter financial results.
It said net revenues were $301.6 million in the three-month period, up 1% from the same time last year. Radio revenues fell 3% while digital revenues were up 12%.
Audacy posted an operating loss of $3 million in the quarter, compared to a loss of $135.3 million a year ago.
The company called particular attention to its adjusted EBITDA numbers. For the quarter, this metric was $31.1 million, up 116% from a year ago; for the first half it was $40.7 million, up 128%. Adjusted EBITDA is a way of assessing performance before considering certain factors including income taxes, depreciation and amortization, restructuring costs and other things.
“Our accelerating financial performance reflects our significant revenue share gains, low-teen growth in digital advertising, high single-digit growth in network radio, and prudent expense reductions, offsetting continued weakness in traditional ad markets,” said company leader David Field in its announcement.
“Notably, our transformational, strategic investments are emerging as a critical driver in our accelerating performance.” He pointed to recent improvements in the company’s streaming and podcasting platforms, along with enhancements to its digital monetization and programmatic capabilities.
