Bondholders Give SBS 30-Day Window After Missing $310 Million Payment.

Spanish Broadcasting System has reached a temporary standstill with most of its bondholders after the company was unable to repay debt that matured earlier this month.

SBS says it has entered into a forbearance agreement with holders representing a majority of its outstanding 9.75% senior secured notes that came due on March 1. The agreement gives the broadcaster additional time to negotiate a broader restructuring of its capital structure.

The company says the arrangement follows what it describes as “constructive discussions” with bondholders regarding a potential transaction to address the maturity of the notes.

Under the agreement, participating bondholders will not to exercise certain rights and remedies for a period of 30 days related to the company’s failure to repay the $310 million in loans that matured at the beginning of the month. That temporary pause effectively gives SBS a short window to continue negotiating a resolution with creditors.

The company says the discussions are focused on reaching what it called a “consensual transaction” with debtholders that would address the debt maturity and restructure the company’s balance sheet.

While the agreement buys SBS time, the company cautioned that negotiations are ongoing and there is no assurance that a final transaction will be completed.

The debt at the center of the negotiations is the company’s 9.75% senior secured notes due 2026, which matured on March 1. Because the notes were not repaid at maturity, bondholders would normally be able to pursue enforcement actions tied to the debt. That typically means creditors could declare the full amount of the debt immediately due, sue to collect what they are owed, seize pledged collateral tied to the loan, or potentially push the company toward bankruptcy proceedings.

The forbearance agreement temporarily prevents those actions while negotiations continue. “These discussions are progressing constructively,” SBS said in a public disclosure.

SBS has been working for months to address the looming maturity. Earlier disclosures warned investors that the company would need to refinance, restructure, or otherwise resolve the debt because its available cash and operating income would not be sufficient to repay the notes outright.

“The company remains focused on serving its audiences, customers and vendors while supporting its employees and furthering the strong relationships it has fostered with its partners and stakeholders over the course of the last four decades,” SBS says. The broadcaster operates Spanish-language radio stations in major markets including New York, Miami, Los Angeles, Chicago and Puerto Rico, along with its LaMusica digital streaming platform and a portfolio of live events.