John Malone Is Assembling the Pieces to Build a Radio Empire

(Bloomberg) -- John Malone's vision for a radio empire is coming into focus.

Last week, the billionaire's Liberty Media swooped in as a potential white knight for IHeartMedia Inc. to help the biggest U.S. radio broadcaster ease its debt of more than $20 billion. Malone's company would sponsor the broadcaster through a Chapter 11 bankruptcy in exchange for a 40 percent stake.

That would give Malone a stake in traditional, satellite and online radio. On an earnings call Thursday, his lieutenant, Liberty Media Chief Executive Officer Greg Maffei, cited “substantial synergies” between the ailing iHeart and two other Malone investments: the majority-owned satellite radio giant SiriusXM Holdings Inc. and Pandora Media Inc., the online music company where Liberty took a minority position last year.

“With the advantage we can bring to the table we think we can perhaps reduce some of the risks that are inherent in the business,” Maffei said.

Read more: Cash-strapped iHeart offers $15.5 million of bonuses for bosses

Sirius could help iHeart protect its position in FM radio in cars (Sirus comes installed in many cars). And Maffei also sees opportunities to cross-promote personalities at the two companies. Howard Stern is the biggest name at SiriusXM, while iHeart has a deal with syndicated radio personality Elvis Duran, among others. iHeart and Pandora, meanwhile, could share advertising technology and salesforces, Maffei said. iHeart's is larger than those at Pandora and Sirius, he said.

It doesn't make sense to consolidate all three companies yet, Maffei said, though working with Pandora and Sirius could help iHeart's struggling radio stations to adapt.

IHeart is expected to file for bankruptcy “in the near term,” he said.

To contact the reporter on this story: Gerry Smith in New York at gsmith233@bloomberg.net.

To contact the editors responsible for this story: Crayton Harrison at tharrison5@bloomberg.net, Rob Golum, Andrew Pollack

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