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One of the largest radio broadcasters in the country is filing bankruptcy in New York.

Citadel Broadcasting, owners of 224 radio stations in 26 states, is hoping to reorganize in the face of a rapidly evolving media world, reports the New York Times.

Citadel vast holdings include stations in some of the nation’s biggest markets, including Los Angeles, New York, Chicago, Atlanta, Minneapolis and New Orleans.

Based in Las Vegas, Nevada, Citadel isn’t the first radio station to struggle in a world of iPods and Internet Radio. With advertising revenue falling, Citadel felt they had to take aciton.

Some media companies that are facing financial issues, like Clear Channel Communications, were able to sell bonds to pay off their debts instead of filing for bankruptcy.

But Citadel decided to enter Chapter 11 bankruptcy as their assets are worth $1.4 billion against $2.5 billion in debt.

Citadel is entering a prearranged bankruptcy. In this type of bankruptcy the company must obtain approval from its creditors to reorganize their debt.

With the bankruptcy plan Citadel will turn over control of the company to its creditors in exchange for reducing the debt. So far Citadel has 60 percent approval from its creditors.

The company’s debt of $2.1 billion in loans will be reduced to $762.5 million. The creditors will then own 90 percent of the company’s equity or assets. Any bondholders with the company will receive a large portion of the remaining equity.

Citadel’s largest unsecured creditors include:  JP Morgan Chase, Wilmington Trust Company and The Walt Disney Co.

Citadel acquired a large amount of debt when the company purchased Disney’s ABC radio stations.

The company’s revenue has severely declined as advertisers spend less on radio. The company reported in the bankruptcy filing that revenue dropped 14 percent to $183.8 million. Their operations revenue dropped 16 percent.

The company plans to continue operations as normal after they emerge through the bankruptcy.

Citadel’s CEO Farid Suleman stated, “We are pleased with support from the majority of our senior lenders, and we look forward to working with the remaining senior lenders and other stakeholders to ensure a complete and expeditious restructuring.”