Tough Luck, JCDecaux

Shareholders of Clear Channel Communications has accepted the revised version of a buy out from private equity group Thomas H. Lee Partners and Bain Capital worth $19.5 billion. Its shareholders were rewarded for holding out on their earlier offer of only $18.7 billion plus debt from this pair of Boston private-equity firms.

But in the midst of the above contentious buyout effort since last year, some analysts have also suggested that Clear Channel stay public and consider selling certain assets, including some of its outdoor assets. Indeed, Clear Channel has received offers for its subsidiary, Clear Channel Outdoor, in two separate occasions from its competitors JCDecaux and most recently Cemusa.

Cemusa is a New York-based unit of a Spanish construction company. It had recently expressed interest to acquire all or part of Clear Channel Outdoor that is 90 percent owned by San Antonio-based Clear Channel Communications Inc. Furthermore, Cemusa has a joint venture agreement with Clear Channel for a contract for street-furniture advertising in Madrid.

Not a bad move since outdoor is the one form of advertising that consumers cannot ignore by fast forwarding, flipping stations, choosing not to click or deciding not to read. Even Clear Channel executives had declared in the 2006 letter to shareholders that "Outdoor advertising continues to be one of the strongest-performing segments of traditional media"

The saga is not completely over yet as the buyout deal must be formally approved by a majority of shareholders in a special, still unscheduled vote. If the deal is ultimately approved, Clear Channel would go into private hands.

Eat your heart out JCDecaux. And so will the rest of us...

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