Report: Liberty Media, Apple Music, circling in on iHeartMedia?

With US radio giant iHeartMedia set to come out of its year-long bankruptcy in early 2019, two major companies are said to be looking to buy into the company.

Liberty Media, owner of SiriusXM, is planning to buy a 35% stake, sources told the New York Post.

This follows speculation last month that Apple has begun talks to take a stake to boost its presence on US radio.

According to the Post, Liberty’s main owner John Malone wants to “create a soup-to-nuts toll taker for music lovers by combining iHeart with his other music properties.”

These also include Pandora (which it announced in September it is acquiring for US$3.5 billion and which will give it a total of 106 million monthly listeners) and a 33% stake in Live Nation, which owns Ticketmaster.

Malone offered $1 billion investment in iHeartMedia in June 2018, but shelved the proposal because iHeart’s financial results were “below expectations”.

A stake in iHeartMedia could allow for creation of a virtual record label, with Citi’s Jason Bazinet noting in October that a new firm could “push songs over satellite radio (via Sirius on an ‘emerging artist’ channel), over playlists (via Pandora) or over FM radio (via iHeart).”

FBN Securities Rob Routh offered another hypothetical: “A ticket to a Live Nation concert could have a code on it in case its holder wants to leave the concert early.

“The ticketholder can then listen to the remainder of the concert on Sirius while driving home.”

Likewise, iHeart could through its 800 stations advertise Live Nation’s concerts and Sirius’ radio shows, Routh added.

Reports last month of Apple Music’s interest in a stake in Heart would mean a major platform through which it can promote Apple Music and bring the Beats 1 digital station to radio.

It would also give Apple a greater clout in the media industry and give it more of an advantage over its closest rival Spotify.

iHeart went into bankruptcy with a debt of US$20 billion.

Last week creditors and financial backers agreed to a restructure which would lighten the debt by two-thirds, and see it emerge from bankruptcy by February.