• Who Buys Clear Channel Outdoor?

    Some people tell Insider that Clear Channel Outdoor will be put up for sale and JCDecaux will have the inside track.  Insider doubts Clear Channel Outdoor will go to a single buyer. It’s too big.

    Look at the analysis below.  Insider assumes a sale of Clear Channel Outdoor Americas (North and Central America) for $5.8 billion or 12 times fourth quarter Americas cashflow annualized.  Clear Channel Outdoor received 12.5 times cashflow the last time it sold assets.  Insider assumes with 100% debt financing.  The purchase increases Debt/Cashflow for Lamar, Outfront and JCDecaux above the 6:1 level which Insider thinks is sustainable.

    Clear Channel Outdoor Sale Analysis.  Figures are in million dollars.

    Lamar can pay the highest multiple for Clear Channel because it can cut the most expenses and maximize revenues after a purchase.  But Lamar faces antitrust problems because it overlaps in most markets.  And Insider doubts Lamar is willing to bet the farm on a Clear Channel Outdoor acquisition just before a recession.

    Outfront wants to operate at 3.5-4.0 times Debt/Cashflow.  It is above its own targets and already needs to finance $800 million in capexp for the New York MTA project over the next couple years.  Outfront would also have anti-trust issues as Lamar because it overlaps in most markets.

    JCDecaux has few antitrust issues except in Chicago and maybe New York City but it has the same post acquisition debt issues.

    What do you hear about the sale or spinoff of Clear Channel Outdoor?  Let Insider know using the form below.

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