The $18.7 billion deal is one of the biggest among recent acquisitions of public firms by cash-rich buyout groups.
SAN ANTONIO, Texas – Clear Channel Communications Inc., the nation’s biggest operator of radio stations, said yesterday that it had agreed to be acquired for about $18.7 billion by a private-investment group.
The transaction would be one of the biggest deals in which a publicly traded company has been taken private, and it showcases the vast sums that buyout groups have been able to assemble for acquisitions.
Clear Channel’s shares jumped $1.24, or 3.6 percent, to $35.36 on the New York Stock Exchange.
In Philadelphia, Clear Channel operates six radio stations, which had combined estimated 2005 revenue of $84.6 million.
The San Antonio company said in a regulatory filing that it did not expect any senior management changes or significant layoffs.
Mark Mays will remain chief executive officer, while his brother, Randall, will stay on as chief financial officer. Their father, Lowry, 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 in a statement.
It is not yet clear how much the Mayses stand to make in the deal. They own about 7 percent of the company.
James Goss, media and entertainment analyst for Barrington Research, said the price of $37.60 was in line with expectations.
“I don’t think there’s anything that’s happened that’s been totally surprising,” Goss said.
Clear Channel also said it planned to sell 448 of its radio stations, all outside the top 100 markets, as well as its 42-station television group, which is also in smaller markets. Collectively, the properties made up less than 10 percent of the company’s revenue last year.
Clear Channel owns or operates 1,150 radio stations.
Once stock market darlings, radio stocks have fallen out of favor on Wall Street in recent years amid sluggish advertising revenue and competition from the boom in portable listening devices such as Apple Computer Inc.’s iPods and the emerging growth of satellite radio.
Since January 2000, Clear Channel stock has fallen from a high of more than $91.
Clear Channel has instituted several measures to try to win listeners back, including cutting back on the number of commercials. Other station operators have yet to embrace its less-is-more strategy.
Call sign/ Station Audience Est. Revenue
Dial Format Share, % 2005
WDAS-AM 1480 Gospel 0.6 $ 2.5 million
WDAS-FM 105.3 Urb Adult Ctmp 6.5 $27.0 million
WIOQ-FM 102.1 Top 40 3.7 $13.9 million
WISX-FM 106.1 Rhythmic* 3.3 $16.0 million
WUBA-FM 104.5 Spanish** 2.2 $12.5 million
WUSL-FM 98.9 Urban ctmp 4.7 $12.7 million
* Was WJJZ, a smooth jazz station, until 8/10/06.
** Was WSNI, an adult contemporary station, until 8/10/06.
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