Author Topic: Clear Channel: selling radio stations to go private?  (Read 1224 times)

sweetcell

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Clear Channel: selling radio stations to go private?
« on: May 02, 2007, 06:23:00 pm »
geesh, i take off for coachella, and the corporate music machine falls apart in my absence.  does this mean we'll have interesting radio sometime soon?
 
  Clear Channel sells assets as part of buyout plan
 
 LOS ANGELES (Reuters) - U.S. broadcaster Clear Channel Communications Inc. said on Wednesday it agreed to sell 362 radio stations for $820 million as it divests assets in accordance with its embattled $19.5 billion plan to go private.
 
 Clear Channel, the largest U.S. radio station operator, did not name any of the buyers of the radio stations.
 
 In November, the company said it planned to sell its television group as well as 448 of its 1,150 radio stations when it agreed to a takeover offer of $36.70 a share from Thomas H. Lee and Bain Capital.
 
 That offer, facing opposition from various shareholders, was raised last month to $19.5 billion, or $39 a share, but the new bid has continued to face resistance.
 
 Clear Channel said on Wednesday it expects to receive $1.875 billion in proceeds from all divestitures announced to date, including the sale of other radio stations and its TV division.
 
 Analysts said the latest update would have little impact on a key shareholder vote on the buyout offer, set for May 8.
 
 "We don't believe that this continuation of divestiture announcements should have much impact on the vote coming up," said Jim Boyle, analyst with CL King & Associates.
 
 On Tuesday, influential proxy advisory service ISS recommended Clear Channel shareholders vote against the higher bid, leading various analysts to predict the buyout would get voted down.
 
 Clear Channel, based in San Antonio, Texas, said on Wednesday these and future divestitures were not contingent upon the completion of the separate merger proposal for the company.
 
 The Clear Channel deal faces a particularly tough hurdle because under Texas law, two-thirds of the company's shares must approve the transaction, not just two-thirds of the votes cast. That means shareholders who fail to vote are counted as voting against the deal.
 
 A source close to Fidelity Management & Research Co. said last month it would not change previous plans to oppose the deal. Another source familiar with the matter said Highfields Capital Management LP would not change its plans to oppose the deal.
 
 Clear Channel said it would continue to pursue the divestiture of 86 radio stations in 16 markets.
 
 Clear Channel said it planned to utilize its capital loss carry forward to offset capital gains on the radio transactions. A portion of the gain would be considered an ordinary gain, not capital gain, and would be taxed as ordinary income.
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