SAN ANTONIO – The $17.9 billion acquisition of Clear Channel Communications Inc. (NYSE: CCU), parent of local radio stations WHJY-FM, WHJJ-FM, WSNE-FM and WHJJ-AM, is ready to proceed now that the bank syndicate backing the buyers has finally come through with the promised financing, Clear Channel said today.
“Today’s actions significantly increase the certainty that our merger will close,” said Mark Mays, CEO of Clear Channel, said last night. “Cash on the barrelhead for one of the largest LBOs in history is an enormous win for our shareholders.”
The media and entertainment company is being purchased by CC Media Holdings Inc., an entity sponsored by private-equity firms Bain Capital Partners LLC and Thomas H. Lee Partners LP. Under the amended merger agreement, shareholders will receive $36 in cash or stock for each share they own.
But in March, the private-equity firms told Clear Channel they would not be able to close on the agreement, first signed Nov. 16, 2006, because they had lost their bank financing for the deal. (READ MORE)
“We want to do this deal,” Bain Capital and THL Partners said at the time. “We are ready to close, have funded the equity portion of the purchase consideration, maintain our enthusiasm for the investment and are fully prepared to fulfill our contractual obligations.”
Clear Channel responded by filing suit against the firms’ backers – Citigroup Inc., Deutsche Bank, Morgan Stanley, Credit Suisse, The Royal Bank of Scotland and Wachovia – alleging “tortious interference” with the transaction.
Yesterday, the bank syndicate fully funded the merger, as required by the terms of a settlement with Clear Channel and its prospective buyers. All debt and equity funds necessary for the closing will be held by The Bank of New York Mellon, pending the closing.
In a related action, Clear Channel said the lawsuits against the bank syndicate filed in March in N.Y. Supreme Court and the State Court in Bexar County, Texas, have been dismissed. The banks, in turn, will dismiss their appeals. “In addition, the banking group and sponsors have agreed that Clear Channel Communications can specifically enforce all contracts related to the merger against any party,” Clear Channel said.
San Antonio-based Clear Channel Communications Inc. (NYSE: CCU) is a global media and entertainment company whose properties include local radio stations WHJY-FM, WHJJ-FM, WSNE-FM and WHJJ-AM. Additional information is available at www.clearchannel.com.
