COMPETITION TRIBUNAL OF SOUTH AFRICA
Case No: 104/LM/Sep07
In the matter between:
BT Triple Crown Merger Co, Inc Acquiring Firm
And
Clear Channel Communications Inc Target Firm
Panel : D Lewis (Presiding Member), M Manoim (Tribunal Member),
and Y Carrim (Tribunal Member)
Heard on : 15 November 2007
Order Issued : 15 November 2007
Reasons Issued: 14 January 2008
Reasons for Decision
Approval
1] On 19 December 2007 the Tribunal unconditionally approved the merger
between BT Triple Crown Merger Co Inc and Clear Channel Communications
Inc. The reasons for approving the transaction follow.
The transaction and parties
2] This is a private equity transaction between two listed companies on the New
York Stock Exchange. Clear Channel Communications Inc (“Clear Channel”) is
being acquired by BT Triple Crown Merger Co Inc (“BT Triple Crown”), B Triple
Crown Finco LLC and T Triple Crown Finco LLC (“the parents”), and CC Media
Holdings (formely known as BT Triple Crown Capital Holdings III, Inc).
3] Post the transaction BT Triple Crown will cease to exist, its parent companies
will dissolve and Clear Channel will be wholly owned by a new limited liability
company named Clear Channel Capital I, LLC, which will be whollyowned by a
new limited liability company named Clear Channel Capital II, LLC. Clear
Channel Capital II, LLC will in turn be whollyowned by the New Holdco
(formerly known as BT Triple Crown Capital Holdings III, Inc). As part of the
equity financing for the acquisition, entities led by Bain Capital (CC) IX, L.P.
(“Bain”) and Thomas H. Lee Equity Fund VI, L.P. (“Thomas H Lee”) will invest
in New Holdco. Bain and Thomas H Lee will each hold 50% of the voting power
in Clear Channel IV which in turn will hold the majority (over 60%) of the voting
control in New Holdco.
Rationale for the transaction
4] Both Bain and Thomas H Lee regard the transaction as an investment
opportunity. From Clear Channel’s perspective the transaction will enhance
Clear Channel’s shareholder value.
The parties’ activities
5] BT Triple Crown is a newly established company which has not previously
traded.
6] Bain holds controlling interests in several entities that trade in South Africa
namely, Samsonite, FCI SA, SigmaKalon BV, MEI Conlux and Edgars
Consolidated Stores Ltd. Through these interests, it is involved in
manufacturing and distribution of luggage, production of electrical connectors,
manufacturing of protective and decorative coatings and paints, manufacturing
of vending machines and retail sale of clothing, footwear, textiles and
stationary.
7] Thomas H Lee controls Nortek Holdings Inc and Simmons Company in South
Africa and through these subsidiaries provides outsourced communications
solutions and distributes indoor environmental control products.
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8] The primary target company, Clear Channel rents advertising space on outdoor
billboards and other advertising devices throughout South Africa.
Competition analysis
9] The proposed transaction does not result in any horizontal overlap and is
therefore unlikely to substantially prevent or lessen competition in any market.
Public Interest
10] There are no public interest issues.
Conclusion
11] The transaction is accordingly approved without conditions
________________ 14 January 2008
Y Carrim Date
Tribunal Member
Concurring: D Lewis and N Manoim
Tribunal Researcher : R Badenhorst
For the merging parties: Goldman Judin Inc
For the Commission : L Madihlaba and M Mohlala (Mergers and
Acquisitions)
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