Clear Channel Tunes Into Banks For Buyout

Morgan Stanley, Citigroup and Deutsche Bank, along with Credit Suisse, RBS and Wachovia, have made financing commitments to back the $26.7 billion buyout of Clear Channel Communications by Thomas H. Lee Partners and Bain Capital. Terms of the financing have not been disclosed. The transaction value includes the assumption of $8 billion in net debt.

Clear Channel announced last Thursday it had entered into a definitive agreement with the two private equity firms to be bought for $37.60 per share. The company announced the same day, it plans to sell Clear Channel TV, the company's 42-station television group, and 448 of its 1,150 radio stations, all located outside of the top 100 markets.

Standard & Poor's lowered the company's corporate credit rating one notch to BB+. The ratings will remain on CreditWatch with negative implications where it was placed Oct. 26 after Clear Channel announced it was exploring strategic alternatives to increase shareholder value. Calls to spokesmen for the private equity firms were not returned. Bankers and a Clear Channel spokeswoman declined comment.