Salem Media Group 375

Salem Media Group has closed on the refinancing of $112.8 million in debt by swapping notes that were due in 2024 for new paper that matures in 2028. The refinance erases $9.3 million in loans from the company’s balance sheet, leaving it with $103.5 million in outstanding debt due in 2024.

The refinance involves the exchange and/or sale and purchase of $112.8 of the 2024 notes into $114.7 of newly issued 7.125% senior secured notes due 2028. That reflects a “call premium” of 1.688%.

In addition to the refinancing, the largest U.S. radio broadcaster providing Christian and conservative programming said it has received commitments from the 2028 noteholders to buy up to $50 million in additional 2028 notes. That’s contingent on Salem meeting some performance benchmarks. Salem says it will use the proceeds to repurchase or repay the 2024 notes.

The refinance pushes out much of Salem’s debt to 2028 and gives it the ability to use proceeds from asset sales and casualty loss to repurchase or repay the 2024 notes. In tandem with the $50 million commitments and other features of the refinancing, Salem says it now has the ability to pay what’s left of the 2024 notes by their maturity date.

“With this refinancing and our expected future free cash flow generation, we believe Salem has a clear path to ultimately push out all of the rest of our outstanding debt maturities. It also provides flexibility to opportunistically invest in our business,” CEO Ed Atsinger says.

The 2028 notes were exchanged and sold to holders of the 2024 notes in a private placement.