Mitt Buys the Medium: Clear Channel

Email Print posted by zenie 12/15/2007 01:03:32 PM EST

Google Technorati del.icio.us digg reddit
Is this affecting Air America's decisions, stations and subscribers? Mitt Romney can't get good enough coverage from the media so he buys one of the biggest companies.

Clear Channel Communications, Inc. Enters into Merger Agreement with Private Equity Group Co-Led By Bain Capital Partners, LLC and Thomas H. Lee Partners, L.P.

Clear Channel Shareholders offered $37.60 per share in cash; Transaction valued at $26.7 billion

San Antonio, Texas, November 16, 2006…Clear Channel Communications, Inc. (NYSE: CCU), a global leader in the out-of-home advertising industry, today announced the execution of a definitive merger agreement with a group led by Thomas H. Lee Partners, L.P. and Bain Capital Partners, LLC, pursuant to which the group will acquire Clear Channel in a transaction with a total value of approximately $26.7 billion, including the assumption or repayment of approximately $8.0 billion of net debt...

...AND...

Mitt Romney's VC Firm to Buy Clear Channel
Posted by Chris Brunner at December 14, 2007 10:25 AM

What would it cost to buy the support of just about every nationally syndicated neocon talk show host in America? About $19.5 billion, which is what Mitt Romney's private equity firm, Bain Capital, and Thomas H. Lee Partners have agreed to pay in a leveraged buyout agreement with Clear Channel Communications, the largest radio station owner in the country. This is part of a negotiation that has been pending for over a year.

Clear Channel owns more than 1,100 full-power AM, FM, and shortwave radio stations, twelve radio channels on XM Satellite Radio, and more than 30 television stations in the United States. Premiere Radio Networks, which is the largest syndication company in the United States, is a wholly owned subsidiary of Clear Channel and is home to Rush Limbaugh, Glenn Beck, and many others. Sean Hannity recently signed a large multi-market contract with Clear Channel, as well.

From an anonymous email:

    "I'll bet those hosts won't reveal that conflict of interest, but it's worth noting when you hear them begin hyping Romney, which has already begun. A lot of GOP supporters will support whomever they are told to support, so be prepared for a big push for Romney. On the bright side, Romney has more vulnerabilities than Rudy, based on his record. Look at this as the GOP establishment doing us a favor. Rich men can bankroll their own campaigns (a la John Kerry), but it takes a special breed to use investors' money to buy entire networks that can operate as passive wings of a presidential campaign."

It should be noted that Mitt Romney, while no longer the CEO, remains a silent partner of Bain Capital.

< Where Are Our Leaders When We Need Them? | We Hear You >
 Display:
Mitt Buys the Medium: Clear Channel | 10 comments (10 topical, 0 hidden)
This is a perfect example (none / 0)
of why we need to have *some* level of regulation!

We can't allow these conflicts of interest.  I'm also glad the democrats (weakly) addressed the issue of politicians going to work as lobbyists by extending the waiting period to 2 years (up from 1) if I remember right.

We need MORE of these types of laws, and obviously, publicly funded elections.

Hell, wouldn't you think democrats, republicans, independents and even those who are generally apathetic cynics (the worst group of all IMO) could come together to make a huge push for publicly funded elections and strict conflict of interest laws?

We *all* stand to gain an enormous amount from it, regardless of our political differences.

by ihavenobias on 12/15/2007 01:13:08 PM EST

Oh yeah (none / 0)
I can't believe I didn't mention media consolidation.  That's another issue you'd think we could *all* come together on because it seriously degrades the quality and diversity of our media.

PS---This is another reason Bill Clinton has questionable progressive credentials.

by ihavenobias on 12/15/2007 01:15:01 PM EST

[ Parent ]
A couple of things... (none / 0)
1. Bill Moyers had an excellent piece on media consolidation last night. See it online: Massing of the Media

2. There is no question about Bill or Hillary Clinton's "progressive credentials." They are conservatives. They are both hawks. Anyone who thinks either of them are representative of progressive values is fooling themselves. There could be nothing more status quo than another Clinton era.

The last truly liberal voice in the White House was Jimmy Carter - and all the signs are pointing to another Democrat being handed a plate of shit with an expectation of turning it into meat loaf, just as happened then.

I pity the person who makes it into that chair... 

by MedfordTim on 12/15/2007 06:07:33 PM EST

[ Parent ]
Meanwhile... (none / 0)

XM and Sirius are having a harder time merging then what Bush had going into Iraq.

by babaganoosh13 on 12/15/2007 05:58:03 PM EST

I read that too (none / 0)
yea whats that about?.. Along the same lines  Dirct TV and Dish Network are having trouble merging as well?  I dont get that.. it would be satalite tv against cable etc

--- Truth To Power

by Leeberal on 12/15/2007 06:49:42 PM EST

[ Parent ]
Satellite Radio (none / 0)

Basically, a lobby group on behalf of terrestrial radio has thrown down over $8 million to stop the merger based on antitrust laws. Right now, it's at the stage where John Conyers (along with Steve Chabot) are trying to slow down as they expressed concern that the justice department might "rush through" an approval.

It has been going on for over 11 months now, longer than the decision to go into Iraq was made. The individual shareholders on both sides have approved the merger. As a satellite radio customer, I actually want this merger to go through. I was an XM customer, but after a car accident, and a great deal from some dude at work trying to unload one that he won, I'm now a Sirius customer.

Immediately what I missed the most after my accident, is no more Republican Sexcapades right after I get off work at 8:00 AM on Thursdays. As well, XM had a wider variety of music, which I liked. On the other hand, Sirius has Howard Stern, Bubba the Love Sponge, Scott Ferrell, the other Howard 101 hosts and shows, football, and more rock.

So far, I feel that having the two different companies have benefited largely the sports leagues. XM and Sirius compete to get the different contracts, inflating the money the different leagues receives. As well, the competition between them and terrestrial radio is a much different beast than that between satellite/cable, and terrestrial TV. Terrestrial TV usually only has a few stations that someone can pick up for free. Depending on where you live, between AM and FM you can pick up dozens of free radio stations. Considering TV is also more popular than radio (for attentive time spent viewing/listening,) that's another thing going against satellite radio (People spend money on TV and probably internet, why would they also want to spend money on radio?) Truckers have to be satellite radios biggest customer base.

With all of that, I can't imagine a merged company wanting to jack up prices too much, if at all for trust reasons for a while. Sirius has been losing a lot of money while it tries to raise its consumer base. It's not a sustainable medium the way things are right now. If there isn't a merger, Sirius probably would go under first, leaving one company, XM. We may as well benefit from the programming of both companies. My greatest concern being Canadian is; what channels will I get and/or lose because of the CRTC? XM Canada doesn't get the ESPNs, some of the music stations and some of those entertainment channels like E! and a couple of news talk stations. It was worse. When I noticed what Sirius Canada got as opposed to XM Canada, I complained. After a few weeks, we got pretty much all of the news stations (ABC News and Talk and America Right I think are the only ones we didn't get. Getting Air America back was a real bonus to me.) Those of us whom bought new 06 Vibes received the American programming for our 3-month trial up until October 06. Losing all of those stations really pissed me off.

In the end, with Air America and the extra news stations, I was pretty happy with XM Canada. Only having Fox News and CNN for news stations really pissed me off. Mike Bullard was the only reason why I kept my subscription after the trial was over. I was going to give them a year to straighten out, which in my opinion, they did. I was going to stick with XM, but I got too good of a deal on this Sirius radio.

As far as the TV merger goes, DirecTV and Dish Network are two companies making a lot of money individually. I can't imagine any good from those two companies merging. Will the programming available become that much better to both customers? How will prices NOT go up for all pay tv customers because of the lowered competition?

by babaganoosh13 on 12/16/2007 06:16:05 AM EST

[ Parent ]
As far as I know... (none / 0)
As far as I know, the deal is being held up because Mel Karmazin's rug wants more money. Seriously though would you look at that thing? How could you negotiate with that guy, I'd be waiting for it to reach across the table and bite me. Bite me, I get that a lot, more often than you'd think. So...I guess we're not going back to your place?

No, really, though, it looks great on you Mel. Call me, call me, we'll do lunch. We'll talk, we'll kvetsch, we'll reminisce, call me baby, call me, really. Ah what a schmeckel I am, I shouldn't have mentioned the wig. Ah well. Mel, the skin, the tan, it looks great. Honey, when it says full power on the bed, maybe you should dial it down a degree or two, I'm just saying. Ah yes, I just got back from Chernobyl, lovely vacation spot. Me and George Hamilton are taking the wives again next month. Call me, we'll do business.

Hello? Hello? Is this thing on?

The Amzin Karmazin

by tiggerporn on 12/16/2007 08:34:29 AM EST

[ Parent ]
27 billion? (none / 0)
I skimmed the article so I'll come back and re-red but how does he have enough money to buy even a 1/50th of that company?

by acroso on 12/15/2007 07:35:18 PM EST

VC (none / 0)
VC stands for venture capital, that's how.

by tiggerporn on 12/16/2007 07:37:08 AM EST

[ Parent ]
Bring Me the Head of Diego Garcia (none / 0)
And if you can't get his, bring me Kevin Martin's instead. He's the real one you should be complaining about, writing, emailing, harassing, throwing stones at, taking down a dark alley and...

OK, well maybe that is going a bit too far, where were we?

Meaning it is not all his money, that is why it is called a leveraged buyout, because he has to leverage against equity.

But remember John Kerry when he took that big loan out, he I believe put up his house, I could be wrong. But he had collateral in the form of equity in his house, or worse if he defaulted, the estate itself. Of course his wife was a billionaire so there weren't worries there I guess.

But the reason they call it venture capital is because it is risky, with great risk come great rewards. Whenever you see one of those Under New Management signs it is possible a company got bought out. You know, same shit different boss. But that is when a lot of companies tighten the belt and cut back on a lot of the frills. They need to cut costs to increase their margins because they are so leveraged.

This is what Trump is a master at, but also why he is such a lying bastard. If the new company defaults on the loans they had to take out to buy the controlling stake, the company's stock can go into junk status. That is exactly when Trump bails out, takes his personal share and then puts his big gaudy gold name up on another property and tells everyone "you're fired!"

He raises a certain amount of money, really a pool of money from different investors, and then they buy up a controlling stake in the company. And that depends on how the corporation they are buying is structured, is it privately held or publicly traded, is there a board, is it family run, that sort of thing.

It is called a hostile take over if the new management buys out the old partners without their consent, often enticing shareholders with a price the company can't match. In the recent Wall Street Journal buyout by Murdoch there was an interesting twist. The company was family owned and run and said they would never ever sell to the likes of Rupert, who's original claim to fame was "Cops" before Fox became ubiquitous. But he offered them a price, what was it 70 a share they couldn't refuse. But then he walked away from it, played hardball because he knew if they were forced to come back to the table he could set the price, so he lowered it five dollars. Now that is a brilliant bastard.

As much as I want to blame Bill Gates, Rupert Murdoch, Steve Jobs, the Disney Corp, Clear Channel, Viacom, At&T, SBC, Comcast, Reverand Moonpies, Pat Robertson and Seagram's for the consolidation of media, the blame rests with only two people:

Kevin Martin and Michael Powell (son of Colin Powell) the head and former head of the five member bipartisan board of the F.C.C. for allowing them to do what they did.

The likes of Murdoch or Gates or Eisner are just like Trump, no better no worse (well, I don't know Murdoch is probably worse even than the Donald) they are just businessmen, they are going to take advantage of whatever opportunities the market affords.

The next big test for the F.C.C. is the transition to digital TV in 2009 when all US network TV is federally mandated to be HDTV. As they will no longer be using that swath of bandwidth, they will be auctioning it off to the highest bidder. That's channels 2 to 13 and UHF, ultra high frequency, 14-68. Google wants to use it to implement a national free (ad based revenue) wifi campaign, and will be rolling out a google phone sometime this year (actually probably a new OS with widgets, which like Linux will run on any platform, in this case phones).

by tiggerporn on 12/16/2007 08:11:36 AM EST

[ Parent ]
Mitt Buys the Medium: Clear Channel | 10 comments (10 topical, 0 hidden)
 Display: