NEW YORK (Bloomberg) — Citadel Broadcasting Corp., the owner of radio stations in cities including New York and Chicago, filed for U.S. bankruptcy protection in Manhattan with a deal to shed $1.4 billion of debt.

The company, which syndicates Don Imus's morning talk show through its US radio network, listed assets of $1.4 billion and debt of $2.5 billion in its Chapter 11 filing yesterday in US Bankruptcy Court. Forstmann Little & Co., a New York-based private-equity firm, owns 29 percent of the company's common stock, according to court papers. The filing covers about 50 units of Las Vegas-based Citadel.

Citadel sought bankruptcy to implement a pre-negotiated plan under which it has the support of 60 percent of its secured lenders, the company said in statement. The plan will convert a $2.1 billion loan into a new $762.5 million term loan, giving senior lenders a pro rata stake, and 90 percent of the shares in the reorganised company.

"We are pleased with the support from the majority of our senior lenders, and we look forward to working with the remaining senior lenders and other stakeholders," Citadel chairman and chief executive officer Farid Suleman said in a statement.

Unsecured creditors and the secured lenders' deficiency claim of about $900 million will get an option of cash equal to five percent of the unsecured claim, capped at $2 million, or 10 percent of the new common stock.

The business, which owns WABC in New York and WLS in Chicago, will operate as usual in bankruptcy, funded by $36 million in cash on hand under a deal with secured lenders.

Citadel's board on December 18 resolved in a telephone meeting that the bankruptcy was "desirable and in the best interests of the corporation," agreeing to appoint Kirkland & Ellis as the company's counsel, Lazard Freres & Co. as an investment bank and Alvarez & Marsal as restructuring adviser, according to court papers.