Great news loyal TMT readers! Your Clear Channel stock has already risen 5% since this morning, after the lovable and huggable Clear Channel announced an agreement to be acquired by a private investor group for $18.7 billion (approx. $26.7 billion plus an assumed $8 billion debt). The Clear Channel board of shareholders unanimously approved the merger agreement, and a special advisory committee of disinterested directors unanimously deemed the transaction to be fair, which means shareholders like you will receive $36.70 per share! Not bad for doing nothing at all.
So why is Clear Channel doing this? Let's see what it had to say in its SEC (Security and Exchange Commission) regulatory filing:
"The Board believes that these decisions are in the best interest of our shareholders. As you know, our Company outperforms the competition in every business in which we operate, but the public market has not appropriately valued our performance. The consortium has agreed to pay $37.60 per share to acquire the company, which is 25 percent greater than our average closing share price of $29.99 during the 30 trading days ended October 24, 2006, the day before the company first acknowledged that it was evaluating strategic alternatives."Clear Channel can still solicit competing bids from third parties (like us or Stylus) through December 7 and negotiate until January 5. Otherwise, the more than 1,100 radio stations and all those billboard and bus-stop ads will be acquired by Thomas H. Lee Partners, L.P. and Bain Capital Partners, LLC.
Current Clear Channel management, including the infamous Mays family, will continue to work for the company. And don't forget about their spin-off company Live Nation!
The $18.7 billion deal was in cash, so if you saw a couple suited douchebags shaking hands in front of a truck full of discreet suitcases, you totally missed your chance to congratulate them on a job well done and thank them for all those radio stations and advertisements.