The news of Interep's demise comes after years of financial hardship capped by a declaration of bankruptcy at the end of March. On Friday, the company elected to have a court convert its Chapter 11 bankruptcy declaration from late March into a Chapter 7 filing, which calls for the liquidation of the firm's assets and breakup of the company.
Interep's woes can be traced, at least in part, to an ill-advised poaching expedition against rival Katz Media Group, a subsidiary of Clear Channel Communications. In an unusually overt bid to undermine Katz, Interep tried and failed in 2003 to lure away Katz's senior executives and over 100 staffers--who would presumably bring many of their clients with them.
While both companies affected appeared to be unruffled by the altercation, insiders said it initiated a period of bitter competition. Interep lost its contracts with Cumulus and Radio One in the second half of 2005; both clients switched to Katz.
At the company's closing, CBS was Interep's sole remaining big client. It's unclear whether CBS would be willing to work with Katz, given its ownership by arch-rival Clear Channel.
After Interep was forced to deregister by the Securities and Exchange Commission in April 2007, it brought in David Kennedy as CEO, with the mission of staunching the revenue losses and rebuilding relationships with radio broadcasters. However, Kennedy was unable to turn Interep's fortunes around, forcing him to assume the role of breakup boss, beginning with the declaration of bankruptcy this March.