Corporate & Securities Law

DOJ Conditions Approval of Private Equity Groups? Acquisition of Interest in Competing Portfolio Company on Divestitures

By Matthew S. Wild

February 13, 2008.  On November 16, 2006, Bain Capital and Thomas H. Lee Partners (?THL?) entered into an agreement to purchase a 70% interest in Clear Channel Communications for $28 billion.  By the time that the transaction closed, Bain and THL also would have private equity interests in two competing radio operators ? Cumulus Media Partners (?CMP?) and Univision Communications.  Notwithstanding that the equity interests would be passive and with respect to Univision would be only 14%, the Antitrust Division alleged that the overlap between these competitors would result in higher prices for radio advertising and Spanish-language radio advertising in the geographic markets in which they compete.  Accordingly, the Antitrust Division conditioned approval of the transaction on divestiture of the competing assets.  The DOJ Press Release and Competitive Impact Statement are attached.  DOJ Press Release (Clear Channel); Competitive Impact Statement (Clear Channel)

Full post as published by Antitrust Commentary on February 28, 2008 (boomark / email).