Clear Channel Communications Sale Still on HoldRadio Giant Tells Securities and Exchange Commission It Can’t Guarantee that $19.5B Deal Will Happen 3/28/2008 10:25:00 AM Eastern
Radio giant Clear Channel Communications let the Securities and Exchange Commission know Friday that it couldn't guarantee its $19.5 billion sale to an investor group would go through by the end of the month, if at all.
The deal was supposed to close March 31, but in the midst of credit woes, some of the banks financing the deal got cold feet. Clear Channel filed suit against the banks, including Morgan Stanley and Citicorp, for interfering with the deal to sell the company to a private-equity group led by Bain Capital Partners and Thomas H. Lee Partners.
A Texas district court granted Clear Channel a temporary restraining order Thursday telling the banks not to "thwart" consummation of the merger, but Clear Channel will not get a hearing on whether to make that order a temporary injunction until April 8.
Meanwhile, Clear Channel said the banks failed to show up for a March 27 meeting to close the merger, and the buyers said they would not be able to close the deal "at that time" due to the banks’ failure to provide the required financing.
"The company continues to be ready, willing and able to consummate the merger under the merger agreement, which remains in effect," Clear Channel told the SEC Friday. "The company is unable, however, to estimate a closing date at this time and cautions the markets that a closing may not occur."