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Clear Channel Buyout Completed
PE buyers had to overcome obstacles; the deal's success marks the second major media deal to reach completion this week.
July 31, 2008
Bain Capital Partners and Thomas H. Lee Partners have completed their $24 billion purchase of Clear Channel Communications, ending their almost two-year pursuit of the San Antonio-based radio station operator after various issues threatened to derail the transaction.
The pair of Boston private equity firms purchased the company, which announced the deal’s completion on Wednesday, through a holding entity named CC Media Holdings. Shareholders, including financial stakeholders such as Highfields Capital Management and Abrams Capital, gave their assent to the $36-per-share deal on July 24. Shareholders were given the option of accepting cash for their shares or one share of CC Media common stock for each share of Clear Channel common stock they own.
Mark Mays, chief executive of Clear Channel, said the deal put the company in a financial and operational position to lead beneficial change in its core businesses, which also includes outdoor advertising.
In May, the Clear Channel leveraged buyout lenders—Citigroup, Credit Suisse, Deutsche Bank, Morgan Stanley, Royal Bank of Scotland and Wachovia—resolved legal wrangling with the financial sponsors over the financing of the transaction. In order to resolve the dispute, the price tag for Clear Channel’s stock was revised downward from $39.20 a share.
In March, Clear Channel sold 56 television stations to Providence Equity Partners for $1 billion, which helped avert court proceedings with the lender to that deal, Wachovia Bank. It was one of a series of radio divestitures by the Texas company.
Clear Channel was advised by Akin Gump Strauss Hauer & Feld.
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