The company will spin off 100% of Clear Channel Entertainment. Shareholders will receive a special dividend of $3.00 per share and a 50% increase in recurring quarterly dividend.
“We’re seeking to unlock the considerable value in our Company, and create a strong foundation for future growth, by improving the strategic, operational and financial flexibility in each of our leading business units,” said Mark Mays, President and Chief Executive Officer. “We expect these transactions to highlight the fundamental value of each of our leading businesses in a tax-efficient manner, so that current and future investors can more clearly evaluate the Company’s overall inherent value. These initiatives are designed to optimally capitalize each business in a manner that generates enhanced equity returns while maintaining strong balance sheets and preserving financial flexibility. Each business will have sharpened management focus and an improved ability to attract, retain and reward employees in a way that’s aligned with shareholders.”
After the initial public offering, Clear Channel will continue to hold a controlling stake in Clear Channel Outdoor.
Mark Mays will continue as Chief Executive Officer and Randall Mays will continue as Chief Financial Officer of Clear Channel’s combined Outdoor operations. The company also today named Paul Meyer as Global President and Chief Operating Officer of Clear Channel Outdoor’s worldwide operations.
Randall Mays, Chief Financial Officer, said, “Clear Channel Communications is fortunate to own businesses which generate substantial amounts of free cash flow and under present circumstances we believe we can best demonstrate that ability by returning a considerable amount of excess capital directly to shareholders. Today’s announcement of a special dividend and a 50% increase in our regular quarterly dividend enhances shareholder returns both at the outset and on a recurring basis. Furthermore, by accretively reinvesting cash flow in these businesses and returning excess capital to shareholders through dividends and share buybacks, we will continue to pursue opportunities to provide the best shareholder returns. We remain committed to maintaining strong balance sheets, with a continued focus on financial discipline.”
After separation, Clear Channel Entertainment will be a separate, publicly-traded company in which Clear Channel Communications will not retain any ownership interest. Clear Channel Entertainment will consist of entertainment operations throughout North America, Europe, South America, Asia and Australia.
Brian Becker, who has served as Chief Executive Officer of Clear Channel Entertainment, has decided to exit the company. Clear Channel Entertainment and Brian Becker have agreed to form a joint venture company to pursue entertainment content opportunities through acquisition and development. Randall Mays is serving as interim Chief Executive Officer during Clear Channel Entertainment’s transition to an independent company.
“Clear Channel’s long history of creating shareholder value has taken another leap forward today,” said Lowry Mays, Chairman. “This bold strategic initiative that the Board approved is a transforming event for the Company and one that will unleash numerous benefits focused on allowing us to continue to provide shareholders with superior long-term returns. Our radio and television, outdoor and entertainment businesses are leaders in their respective industries. Each has respected management teams and unique opportunities for growth. We couldn’t be more excited about our Company’s future.”
Popularity: -0%
