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Clear Channel sale in jeopardy...

D

dustintv

So says the front page of Radio-Info:

The Wall Street Journal reports that Clear Channel "was open to a lower price" than Providence Equity Partners agreed to pay last year - but that San Antonio believes "the private equity firm wasn't serious about completing the transaction." The breakup fee on the $1.2 billion transaction is a relatively modest $46 million, and PEP may be ready to eat some or all of that, rather than consummate the deal. The lawsuit is keyed to the "specific performance" clause in the sale contract, and it seeks to compel the buyer to go to closing. There's an additional complication, because of Clear Channel's much larger deal to take itself private with Bain Capital and Thomas H. Lee Partners. If the TV-group sale doesn't close before CC goes private, it would have to re-file the deal to sell to Providence - or to anybody else.
Click to expand...

Wow I bet this is probably the Mays' worst nightmare come true--terrible economic conditions, deals falling through at the eleventh hour etc. Of course this means the fate of stations like WHAM and WSYR is still up in the air at this point. Wonder how morale is?
 
From what I hear, morale isn't bad -- but that could change in a heartbeat if the lawsuit comes out in Clear Channel's favor.

Put yourself in Providence's shoes. Being forced to buy something you don't want, at a price higher than you wanted to pay... what's the first thing you're going to do? They probably would be looking to hack away anyway -- with the lawsuit, it could be even worse.

CNN has an article with Providence's take on the matter
http://money.cnn.com/2008/02/17/news/companies/clear.channel.ap/index.htm?section=money_latest
 
Actually I see someone coming with a hacksaw either way. Which is just a shame, as both WHAM and WSYR have been largely untouched by such actions which damaged stations like WKBW, WROC and WTVH and simply decimated stations like WWTI and WUTR.
 
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