The Clear Channel Buyout

Videos by American Songwriter

Videos by American Songwriter

Clear Channel Communications Inc., owner and operator of over 1,200 radio stations nationwide, has officially settled its longwinded legal battle with six Wall Street banks over a potential privatization of the company.


Clear Channel Communications Inc., owner and operator of over 1,200 radio stations nationwide, has officially settled its longwinded legal battle with six Wall Street banks over a potential privatization of the company.

In conjunction with the banks, private firms such as THL Partners and Bain Capital will follow through with a revised buyout that places shares at $36—presuming Clear Channel shareholders vote in favor of the buyout. This seems likely because this recent legal trouble led to a deduction of shares, causing them to dwindle as low as $25.82.

With only 14 days to come up with the cash, each involved bank, including Citigroup Inc., Morgan Stanley, Deutsche Bank, and Wachovia Corp. among others, must fulfill a financial proposal that will ultimately resolve recent conflicts. Lawyers of both private-equity firms stated that the trial was to be put on hold, “to enable the parties to carry out the terms of the settlement…” which until late yesterday was up in the air.

Agreeing to price the buyout at $17.9 billion, the whirlwind financial dispute between several entities began to calm and call it a day. Private equity lawyer Bruce Kaplan was grateful that the New York judge came to a prompt decision and he thanked her for making sure the case was taken “from full discovery to trial in 48 days.”

The latest agreement will undergo a shareholder vote in August or September.


Whether this will improve what you hear on drive-time radio cannot be certain, but going private will alleviate the burden of meeting the quarterly goals of public shareholders. Maybe there is hope for a terrestrial radio renaissance?

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