Clear Channel clears buyout hurdle

Clear Channel Communications Inc. said the debt financing needed for its $17.9 billion sale to two private equity firms is in place, clearing one hurdle in the transaction's path.

"Today's actions significantly increase the certainty that our merger will close," said Mark Mays, chief executive officer of San Antonio-based Clear Channel.

The radio and outdoor advertising company agreed to be acquired by the buyout firms Bain Capital Partners and Thomas H. Lee Partners in November 2006. Earlier this month, the company decided to take a lower price and slightly higher lending rates to settle a dispute with lenders.

The lenders, which include Citigroup, Deutsche Bank, Morgan Stanley, Credit Suisse, Royal Bank of Scotland and Wachovia, agreed to place all financing into an escrow account, pending the deal's closing, Clear Channel said Friday.

The bank syndicate had until Friday to comply with a settlement agreement in connection with lawsuits filed in March in the Supreme Court of the State of New York and state court in San Antonio.

The acquisition's private equity sponsors and certain shareholders investing in the new company are required to fund the equity financing into escrow by Wednesday.

The final $36 per-share deal price was 8 percent below the latest offer of $39.20, and even below the original price of $37.60 that major shareholders had opposed as being too low.

Clear Channel shares rose 5 cents to $34.82.