Lawyers, stations and money


Warren Zevon wrote about lawyers, guns and money. We hope it doesn’t get to the point that guns become part of the equation when it comes to a pending deal for 187 Clear Channel stations, but money has already been deposited and the lawyers are entering both stage left and stage right. Jeff Warshaw’s Frequency License LLC is replacing Dean Goodman’s GoodRadio.TV as the front man for ultimate buyer American Securities Capital Partner, which is no longer happy with the 452.1M price tag. Clear Channel, on the other hand, is taking steps to protect it. According to reports, Clear Channel has filed suit in a Texas court to see that the deal goes through as originally negotiated or that it gets a hefty break-up fee currently sitting in escrow, and American Securities literally followed suit in a New York court. According to the contract for the transaction filed with the FCC 5/15/07, the buyers have already forked over 20M into such an account. Clear Channel is said to have warned affected market managers to proceed with business as usual to assure that there are no grounds for charges that the businesses have been allowed to deteriorate in any way.

RBR observation: The much bigger deal, the multibillion dollar transaction to take Clear Channel private via a stock purchase by Mays family, Bain Capital and Thomas H. Lee Partners, has the oft-postponed shareholder vote on the calendar for 9/25/07. Rampant speculation is that the last thing the company wants to do ahead of that is show weakness of any kind. That vote is already half a year behind it’s originally-scheduled date of 3/21/07. This should be interesting. Stay tuned.