DOJ GIVES CLEAR CHANNEL-AMFM MERGER THUMBS UP

The Department of Justice approved the $23.8 billion merger of Clear Channel Communications and AMFM after the companies agreed Tuesday (8/29) to sell part ownership of a billboard company.

Following the merger with Dallas-based AMFM, San Antonio-based Clear Channel will be the largest radio broadcaster in the U.S., owning or operating about 900 stations.

Under government pressure, Clear Channel and AMFM agreed to sell 99 radio stations in 27 markets, the largest radio divestiture ever. So far, the companies have sold 85 stations. The Justice Department requires the companies to sell the remaining 14 stations within 150 days. Still on the auction block are the following stations: WEEX-AM and WODE-FM (Allentown-Bethlehem, PA); KVOD-AM (Denver); WNCE-FM, WNNK-FM, WTCY-AM and WTPA-FM (Harrisburg-Lebanon-Carlisle, PA); KJOJ-AM, KJOJ-FM, KQUE-AM, KSEV-AM and KTJM-FM (Houston-Galveston, TX); and WMEZ-FM and WXBM-FM (Pensacola, FL).

The other hurdle in the deal was AMFM's 29% interest in billboard company Lamar Advertising; Clear Channel already owns Lamar competitor Eller Media.

The Justice Department, fearing that a merger that did not include the divestiture of Lamar "would have harmed advertisers who rely on radio or out-of-home advertising," had filed suit against the original deal. If the companies complete their promised divestitures, that would settle the government's original lawsuit, which alleged substantially reduced competition in out-of-home advertising and in five radio markets in Pennsylvania, Colorado and Florida.

Said Assistant Attorney General A. Douglas Melamed of the DOJ's antitrust division, "The divestitures required by the consent decree ensure that customers of both types of advertising will continue to enjoy the benefits of competition—low prices and high quality services."