(Part of an
ongoing series on Clear Channel ..)
Below the fold...
Clear Channel Communications announces the spinoff of Clear Channel Entertainment in the wake of CCC's announcement of a $4.7 Billion loss for Q4 of 2004 and continued losses in their radio holdings.. Their radio stations are tanking and their concert promotions business is struggling - this is a necessary but highly embarassing outcome for all those investors who bought Clear Channel's line about "synergy" between their radio, advertising and concert promotions holdings..
But wait, hold the phone .. looks like Clear Channel Entertainment is in hot water as well .. fresh off a $90 Million judgement against them for tortious interference with a Chicago promoter, the promoter has now asked the judge to order the $90M secured for fear of Clear Channel's insolvency and inability to pay..
more..
Clear Channel's Legal Woes Continue
May 09, 2005
By Ray Waddell
SOURCE: Billboard.biz
Attorneys for Jam Productions filed a motion in U.S. District Court in Chicago last week seeking a court order for Clear Channel Communications (CCC) to secure the previously awarded $90 million judgment would be paid to Jam.
In March, a Chicago jury awarded more than $90 million to JamSports and Entertainment, a Jam subsidiary, in a suit against CCC subsidiary Clear Channel Entertainment (CCE) and Paradama Productions (dba AMA Pro Racing) regarding promotion of American Motorcycle Assn. (AMA) events.
In court on May 5, Jam attorneys cited a recent negative earnings report issued by Clear Channel, as well as the recent news that CCE chairman/CEO Brian Becker would be stepping down and that CCC would spin off CCE as a separate entity (Billboard, May 14).
"On March 31 [CCC] released an earnings report that showed a dramatic drop in profitability that has triggered a grave concern on our part concerning the company's financial stability," Jeffrey Singer, one of the attorney's for Jam, tells Billboard.biz.
According to Singer, under court rules, when a party wins a judgment for money and the losing party will appeal, the courts have a provision that requires the losing party to secure the obligation to the prevailing party, which can be done through a deposit with the court clerk, a bond from an insurance company, or a letter of credit from a financial institution.
Jam attorneys will be asking the court to change a previous ruling that did not require the bond from CCC. The court will entertain arguments on this motion on May 11 before Judge Matthew Kennelly.
Clear Channel Sets Spinoff, IPO of Two Units
By Franklin Paul Fri Apr 29, 5:31 PM ET
NEW YORK (Reuters) - Clear Channel Communications Inc., the largest U.S. radio station chain that has been facing falling audiences, on Friday said it will spin off its unit that produces live entertainment and sell about 10 percent of its outdoor advertising business in an Initial Public Offering....
Clear Channel's debt ratings moved a step closer to junk status on Friday as Moody's Investors Service and Fitch Ratings both said they were considering cutting Clear Channel after it announced its plans to dismantle its media empire.
Shares of Clear Channel have fallen by about 26 percent over the last year, as it has lost advertising dollars to the Internet and lost listeners to satellite radio services and digital music players such as the iPod.