One thing is clear at Clear Channel Communications (NYSE: CCU) -- the company's $19.5 billion buyout is not looking good.According to a Reuters story, the proxy advisory service ISS said that the deal is too cheap and that shareholders should reject it. The firm is highly influential in such matters and institutional investors often follow its recommendations.
The private equity buyers -- Bain Capital and Thomas H. Lee -- have upped their bid from $36.70 to $39. They also have said it was their "best and final" offer.
Well, in light of the ISS decision and vocal opposition from major shareholders like Fidelity, it look s like the company will not get shareholder approval. Because of Texas corporate law, Clear Channel needs to get a two-thirds majority. The shareholder meeting is on May 8th.
Then again, this may also be an indication that private equity firms are trying to show some restraint.
And, yes, it looks like the Street has already factored these things in. Clear Channel's stock is at $36 today.
Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.
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