Clear Channel mulls raised bid; vote date changed
EmptyNEW YORK -- Clear Channel Communications Inc. on Monday said it was delaying a shareholder vote on a $19.6 billion buyout proposed by two private equity firms, as it considers a revised offer the bidders proposed last week.
It is delaying the vote, scheduled for Tuesday, to May 22.
Clear Channel originally rejected the $19.6 billion, or $39.20 per share, bid made last week, arguing that acceptance would delay the date of the meeting by up to 90 days, with no certainty the transaction would be approved by shareholders.
The bidders, Bain Capital Partners and Thomas H. Lee Partners, previously offered $39.
But shareholders have since been pressuring Clear Channel to reconsider its decision, with several telling Reuters they had called the company's board to persuade them to delay the vote.
While the new bid appeared to gain more shareholder support, it remained unclear whether it would gather enough support to succeed.
The deal faces a difficult hurdle because under Texas law, two-thirds of the company's shares must approve the transaction. That means shareholders who fail to vote are counted as voting against the deal.
The revised structure had been supported by Highfields Capital Management LP, a significant shareholder originally opposed to the bid, sources told Reuters last week.
However it was still unclear whether Fidelity, a major shareholder that has steadfastly opposed the sale, would support the new bid. Fidelity was not immediately available for comment.
Opposition from Fidelity and Highfields, as well as proxy advisory service ISS, to the original deal had dealt a large blow to the prospects of getting it through a vote.
Clear Channel's shares rose 2% to $37.13.