Providence Equity Partners really wants to welch on its deal to buy Clear Channel’s TV stations, but that’s not the only deal CCU is having a hard time closing.
Clear Channel dropped any pretense of renegotiation and sued Providence on Friday to get them to move forward on a deal to buy 56 TV stations for $1.2 billion. But the bigger question is what’s happening to plans to sell the rest of the company for $19.5 billion, a deal negotiated more than a year ago.
Thomas H. Lee Partners and Bain Capital agreed to take CCU private in Nov. 2006, for $39.20 a share. Now CCU is trading 21% lower, and the market seems to believe the buyout won’t happen.
As always, Clear Channel says the acrimonious state of the $1.2 billion buyout of its TV stations has no effect on the deal to sell the rest of the company to Thomas H. Lee Partners and Bain Capital. But the same forces that caused the TV deal to collapse—the end of easy credit, dim outlook on advertising—could cause the bigger deal to collapse as well.
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