CCU getting ducks in a row


Clear Channel Communications reports its Q4 earnings this Thursday, with the Thomson/First Call analysts’ consensus that the company will report revenues down 4%, but earnings per share flat. But more important is how the company is moving toward a Q1 completion of its going private buyout.

FCC approval has already been received. Bear Stearns analyst Vic Miller believes Clear Channel filed for antitrust clearance from the Department of Justice on January 14th. If so, he says DoJ approval could come as soon as Wednesday if Clear Channel, as it hopes, gets early termination of the waiting period.

With Clear Channel stock still trading well below the 39.20 buyout price, Miller sees a chance for Thomas H. Lee Partners and Bain Capital to do some buying on the cheap. “After the DOJ gives approval, we believe that THL and Bain may be able to ‘average down’ their equity contribution by buying shares in the open market to the extent the shares are less than 39.20.  CCU’s largest ‘stub equity’ participant, Highfields, seem to take this route in the last two weeks. We will look for evidence of this potentiality from Bain and Lee,” Miller said in his latest note on the long-pending buyout. He still thinks the deal will close at the target for closing is in the March 1-15 range.

Although closing the sale of Clear Channel Television for 1.225 billion to Providence Equity Partners’ Newport Television LLC, is not a prerequisite for closing the deal to take Clear Channel Communications private, that transaction is moving along as well. Newport has now filed with the FCC to put nine of the 35 stations in the hands of a trustee, pending sale, as required by the FCC action approving the acquisition.

RBR/TVBR observation: Hardly a day goes by without some Wall Street money manager calling RBR to try to find out if we have any behind-the-scenes information on whether or not this deal is going to closing. Sorry, but we don’t work that way. What we know is what we’ve published. And when we find out anything new, you, our readers, are the first to know. As we’ve noted repeatedly, nether Clear Channel management, Thomas H. Lee Partners, nor Bain Capital has done or said anything which would indicate that this deal will not close as scheduled this quarter. But the CCU stock price still shows a lot of nervousness on Wall Street.