DOJ To Clear Channel: More Stations Must Go
February 13, 2008 at 4:07 PM (PT)
The DEPARTMENT OF JUSTICE has told CLEAR CHANNEL COMMUNICATIONS that it must divest radio stations in four cities -- CINCINNATI, HOUSTON, LAS VEGAS and SAN FRANCISCO -- before being acquired for $19.5 billion by a private equity group led by BAIN CAPITAL and THOMAS H. LEE PARTNERS.
The reason for the divestitures is that BAIN and LEE own interest in competitors in those cities, to assure continued competition in markets where the transaction would otherwise result in a significant loss of competition. The DOJ's Antitrust Division must approve the buyers of the divested CLEAR CHANNEL stations.
According to the complaint filed by the DOJ's Antitrust Division, radio stations owned by CLEAR CHANNEL and CUMULUS compete head-to-head in CINCINNATI and HOUSTON, while CLEAR CHANNEL and UNIVISION own competing Spanish-language radio stations in HOUSTON, LAS VEGAS, and SAN FRANCISCO.
"Without the divestitures obtained by the department, advertisers that rely on radio advertising in the affected cities likely would have faced higher prices," said THOMAS O. BARNETT, Assistant Attorney General in charge of the Antitrust Division. "The divestitures will ensure that advertisers will continue to receive the benefits of competition." For the full DOJ press release, just click here.
CLEAR CHANNEL has been contacted for comment. More details to come!