- The Washington Times - Thursday, November 16, 2006

SAN ANTONIO (AP) — Three weeks. That’s how long it took radio giant Clear Channel Communications Inc. to accept a buyout offer led by two private equity firms after announcing in late October that it was considering “strategic alternatives.”

And while the nation’s biggest radio station operator has left the door ajar in case something better comes along, it agreed to an $18.7 billion offer from Thomas H. Lee Partners LLC and Bain Capital Partners LLC.

In addition to paying $37.60 in cash for each Clear Channel share, the buyers will assume an additional $8 billion in debt.

The transaction would be one of the biggest deals to take a company private, and illustrated the vast sums that buyout specialists have been able to assemble to acquire public companies.

San Antonio-based Clear Channel’s shares jumped $1.24, or 3.6 percent, to close at $35.36 on the New York Stock Exchange yesterday after rising earlier to a new 52-week high of $35.88.

The company has until Dec. 7 to solicit competing proposals. Another bid for Clear Channel had been expected from Providence Equity Partners, the Blackstone Group and Kohlberg Kravis Roberts & Co.

“Basically they are telling you that we have a firm offer and a firm deal, but we are not going to get locked into it yet,” said Frederick Moran, a Boca Raton, Fla.-based analyst for Stanford Financial Group.

The company said in a regulatory filing that it doesn’t expect any senior management changes or significant layoffs.

Mark Mays will remain CEO while Randall Mays, his brother, will stay on as chief financial officer. Their father Lowry Mays, the chairman, will continue to have an active role, the company said.

“Clear Channel is an exceptional media franchise that is well-positioned to grow thanks to the solid foundation the Mays family has created,” John Connaughton, a managing director at Bain Capital, said.

It’s not yet clear how much the Mays stand to make in the deal. Clear Channel said yesterday that three members of senior management agreed to “significantly” reduce payments that would be made on a change of control.

A Clear Channel spokeswoman declined to elaborate. The Mays family owns about 7 percent of the company.

Clear Channel also said it plans to sell 448 of its radio stations, all located outside the top 100 markets, as well as its 42-station television group, which is also located in smaller markets. Collectively the properties made up less than 10 percent of the company’s revenues last year.

The acquisition is not dependent on the sale of those assets, the company said.

Clear Channel owns or operates 1,150 radio stations and is the largest operator of radio stations in the country.

In the Washington-Baltimore area, the company owns 13 stations, including WASH FM 97.1, WBIG FM 100.3, WMZQ FM 98.7 and WWDC FM 101.1.

A spokeswoman said it is not clear if D.C.-area listeners should expect any immediate changes in management or programming at local stations if the acquisition goes through.

“That will be up to the new owners,” she said.

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