Shareholders of radio broadcasting and outdoor advertising group Clear Channel Communications have approved the USD17.9bn acquisition of the company by a private equity consortium led by B
Shareholders of radio broadcasting and outdoor advertising group Clear Channel Communications have approved the USD17.9bn acquisition of the company by a private equity consortium led by Bain Capital Partners and Thomas H. Lee Partners, paving the way for completion of the deal on Wednesday.
The number of shares voted in favour of the transaction represented more than 74 per cent of the total shares outstanding and entitled to vote at the meeting, and accounted for about 97 per cent of votes cast.
‘We are pleased with the outcome of today’s vote,’ says Clear Channel chief executive Mark Mays. ‘On behalf of Clear Channel’s board of directors, I want to thank our shareholders and hard-working employees for their support throughout this process.’
The vote brings to a conclusion a long-running saga lasting nearly two years during which the terms of the deal were argued over, reflecting the trickier economic conditions and financial market environment resulting from the credit crunch, which began after the deal was agreed at the height of the private equity boom in 2006.
The deal was held up by an attempt by six banks that agreed to provide finance for the deal, Citigroup, Morgan Stanley, Credit Suisse, Royal Bank of Scotland, Deutsche Bank and Wachovia, to back out as private equity debt became increasingly hard to sell on to other investors.
In March this year T.H. Lee and Bain launched legal action against the banks to enforce their agreement to fund the deal, but a compromise was struck two months later to settle the dispute, with the price offered to shareholders being lowered from USD39.20 to USD36 per share in cash.
As an alternative to the cash offer, shareholders of San Antonio, Texas-based Clear Channel were offered the opportunity exchange some or all of their shares on a one-for-one basis for shares of Class A common stock of CC Media Holdings, the acquisition vehicle formed by the private equity group.
Founded in 1974, Thomas H. Lee Partners has raised some USD22bn of equity capital and invested in more than 100 businesses with an aggregate purchase price of more than USD125bn, completing over 200 add-on transactions. Notable acquisitions sponsored by the firm include Ceridian, Dunkin’ Brands, Experian, Nielsen Company, Warner Chilcott and Warner Music Group.
Bain Capital, which has headquarters in Boston and offices in New York, London, Munich, Tokyo, Hong Kong, Shanghai and Mumbai, manages various pools of capital including private equity, high-yield assets, mezzanine capital and public equity with more than USD82bn in assets. Since its establishment in 1984, Bain has made private equity investments and add-on acquisitions in more than 230 companies worldwide, including Burger King, Toys ‘R’ Us, AMC Entertainment and ProSiebenSat1 Media.
