The nation’s largest radio broadcaster is having trouble unloading some of the nearly 400 stations it has made deals to sell.
Less than a month after terminating an agreement to sell 46 stations to a Chicago buyer, Clear Channel Communications Inc. is in Bexar County District Court suing another would-be buyer.
The San Antonio-based broadcaster claims Frequency LLC, which in April struck a $452 million deal to buy 187 Clear Channel stations, is in breach of its contract. Clear Channel also is suing Frequency consultant Jeffrey D. Warshaw for attempting to renegotiate the deal price.
Frequency, created to buy the stations and funded by the New York private-equity firm American Securities Capital Partners LLC, is refusing to complete the deal unless Clear Channel lowers its price by $102 million to $350 million, court documents said.
Warshaw has told Clear Channel his client “would not close at the previously agreed-upon price,” according to the documents.
Clear Channel and Warshaw declined to comment for this article. American Securities Capital Partners and Frequency LLC executives did not return calls seeking comment. When the deal was announced, Frequency LLC was known as GoodRadio.TV.
On Nov. 16, Clear Channel announced it would sell 448 of its more than 1,000 stations. The same day, it announced an $18.7 billion buyout agreement with a pair of Boston private-equity firms. The company’s buyout price since has risen to $19.5 billion, or $39.20 per share, following investor opposition.
Clear Channel shares closed unchanged Friday at $36.80 on the New York Stock Exchange.
As of June 30, Clear Channel had sold 29 stations for $75.8 million, the company said. A total of 389 stations, including the 187 at the heart of the Frequency suit, were under purchase agreements valued at a total of $871.5 million.
Clear Channel this month terminated a $62.2 million deal to sell 46 Midwest stations to Chicago-based Blue Point Me-dia LLC, saying, “Not all buyers are able to complete their purchase.”
Blue Point CEO Chris Devine, who could not be reached for comment on this article, told BusinessWeek this month that “the numbers just didn’t work.”
The sale already had gained approval from the Federal Communications Commission.
Meena Thiruvengadam, San Antonio Express-News