Clear Channel racing toward July 30 closing


Just a few weeks ago Clear Channel Communications was telling shareholders to expect the company’s long-pending buyout to go to closing in Q3. But they’ll only have to wait until the first month of the quarter. Shareholders will vote on whether to accept the $36 per share offer on July 24th and closing is set for July 30th.

This has been a long time coming, but it looks like the $23.8 billion deal to take Clear Channel private is about to cross the finish line. All it took was battling in Texas, New York and Federal courts, not to mention several revisions of the terms along the way.

Shareholders of record as of June 19th will be eligible to vote at the July 24th meeting. Clear Channel is still a Texas corporation, so approval by two-thirds of all shareholders is required for the deal to go through.

Highfields Capital, which led last year’s revolt that forced Bain Capital and Thomas H. Lee Partners to increase their bid to $39.20 per share, is onboard with the revised buyout deal. But Clear Channel management will still have to beat the bushes to make sure enough shareholders vote to get over that 66.66% hurdle.

A closing in Q2 instead of Q3 means that Clear Channel managers may see corporate HQ lighten up a little sooner on its tight cost controls. President and CFO Randall Mays assured managers in a memo earlier this month that “we will go back to our normal procedures” once the closing takes place. Just what that means remains to be seen.

RBR/TVBR observation: We still have not heard any indication that there will be any organized opposition to the $36 price at the July 24th meeting. That $39.20 bid is now a distant memory as shareholders look at what’s happening to oil prices, the US economy and stock prices every day. Time to take the money and run.