Clear Channel Outdoor sells $2.5 billion in bonds


After finding the high yield bond market (a/k/a junk bond market) especially receptive, Clear Channel Outdoor (COO) boosted its proposed $750 million offering of senior notes due 2017 to $2.5 billion – the entire amount of its debt to parent Clear Channel Communications (CCU). Just as interesting is the updated financial data filed with the SEC by CCU.

When the bond sale by CCO (owned 89% by CCU) was announced, CCU told the SEC that Clear Channel Radio revenues were pacing down 1% for December. In the eight days between filings business had improved. CCU said in an SEC filing on Friday that radio is now pacing flat for December. November was still put at down 8% after a 19% decline in October.

The updated pacings were mixed for the US outdoor business. Rather than being flat for both November and December after a 4% decline in October, domestic outdoor is now seen as down 1% for November and up 1% for December. So, like radio, a positive trend.

RBR-TVBR reported Friday that Moody’s Investors Service had lowered its rating on the CCO bond issue after it was increased to $2.5 billion from the original $750 million. Wall Street did, indeed, have an appetite sufficient to take the larger offering. The $2.5 billion offering of senior notes due 2017 were sold with a yield of 9.25%. The joint book-running managers were Goldman Sachs, Citi, Morgan Stanley, Credit Suisse and Deutsche Bank Securities, with co-managers BofA Merrill Lynch, Barclays Capital and Moelis & Company.

RBR-TVBR observation: Yes, that is the light at the end of the tunnel. It’s hardly a bull market for radio ad sales, but at least the downturn is over. As for the vulture capital funds who believed they’d be able to force CCU into Chapter 11 and grab assets on the cheap – time to move on to a new game.