Clear Channel shareholders OK buyout


Shareholders of radio giant Clear Channel Communications on Tuesday finally approved a $19.5 billion takeover offer from a group of investors led by Thomas H. Lee Partners and Bain Capital Partners.

The transaction -- unusual in that it allows shareholders to keep up to 30% of the company -- has been 10 months in the making, having begun with a bid of $37.60 per share that eventually rose to $39.20 and includes the assumption of more than $7 billion in debt.

At a Tuesday meeting, votes representing 73% of the outstanding shares were in favor of the buyout, the company said. That meant Clear Channel passed the two-thirds approval hurdle that was required.

Shareholders might take cash or a "stub equity" stake in Clear Channel, up to a maximum of a cumulative 30% of the company, which will make Clear Channel a sort of hybrid company that is part private and part public.

The stub equity plan was part of a concession in May to sweeten the deal that also included an upping of the per-share offering price to $39.20. By then, it had already risen from $37.60 to $39 as large shareholders signaled their displeasure with lesser offers.

Observers said the deal likely won over shareholders in the end amid the recent credit crunch that has made any higher buyout bids unlikely.

CEO Mark Mays said he is working to close the transaction "as quickly as possible."

Clear Channel, which has sold off its TV stations and is selling more than 400 radio stations, will be left with an interest in the outdoor advertising business and about 675 radio stations.

Thomas H. Lee Partners is part of a consortium of private-equity groups that owns the Nielsen Co., parent company of The Hollywood Reporter.

Other media investments from the group include radio firm Cumulus, Spanish-language broadcaster Univision, Warner Music Group and American Media, parent of Star magazine and the National Enquirer.

Clear Channel shares rose 0.8% on Tuesday to $37.05.
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