Two private equity consortiums have put in competing bids to take over Clear Channel Communications, the country’s largest radio chain, from the Mays family.
The decision was made when Paul J. Salem of Providence Equity Partners made a pitch to Clear Channel’s Randall Mays, his old classmate from
The offers are expected to be worth from $36-37 a share, which would value the company at about $18 billion and put more than $1 billion in the pockets of the Mays family, which has been building Clear Channel into a giant with stations like N.Y.’s Z100 and
Shares of Clear Channel closed down 59 cents to $34.38 yesterday as some investors worried that the premium wouldn’t be as high as expected. Some analysts had predicted a bid of as much as $40 a share.
The bidding groups vying for Clear Channel in the auction being conducted by Goldman Sachs include two groups, one composed of Providence Equity Partners, the Blackstone Group and Kohlberg Kravis Roberts & Company; the other including Bain Capital, Thomas H. Lee Partners and the Texas Pacific Group. No other media company or Clear Channel rival appears to be involved.
Earlier this year,
Despite the auction, it remained unclear last night whether the Mays would ultimately sell. It is possible they could decide to simply continue running the company if the bids are not high enough. The board is expected to quickly review the bids and reach a formal decision on the sale as early as this week.
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