Clear Channel Communications Announces Settlement of Litigation and Amended Merger...

Clear Channel Communications Announces Settlement of Litigation and Amended Merger Agreement with Private Equity Group Co-Sponsored by Thomas H. Lee Partners, L.P. and Bain Capital Partners, LLC

Shareholders Now Offered $36.00 Per Share in Cash in Deal Valued
at $17.9 Billion

Shareholders May Still Elect to Invest in New Corporation Formed
to Acquire Clear Channel

Board of Directors Unanimously Approves Settlement of Litigation
and Amended Merger Agreement

New Special Meeting of Shareholders to Be Held
SAN ANTONIO--(Business Wire)--
Clear Channel Communications, Inc. (NYSE:CCU) today announced that
the company, entities sponsored by Bain Capital Partners, LLC and
Thomas H. Lee Partners, L.P., and a bank syndicate consisting of
Citigroup, Deutsche Bank, Morgan Stanley, Credit Suisse, Royal Bank of
Scotland and Wachovia, have entered into a settlement agreement in
connection with the lawsuits previously filed in the Supreme Court of
the State of New York and the State Court in Bexar County, Texas.
Pursuant to the terms of the settlement agreement, the parties have
agreed to enter into a third amendment to the previously-announced
merger agreement. Under the terms of the merger agreement, as amended,
Clear Channel shareholders will receive $36.00 in cash for each share
they own.

As an alternative to receiving the $36.00 per share cash
consideration, Clear Channel's shareholders will again be offered the
opportunity on a purely voluntary basis to exchange some or all of
their shares of Clear Channel common stock on a one-for-one basis for
shares of Class A common stock in CC Media Holdings, Inc., the new
corporation sponsored by the private equity group to acquire Clear
Channel. In limited circumstances, shareholders electing to receive
some or all cash consideration, on a pro rata basis, will be issued
shares of CC Media Holdings Class A common stock in exchange for some
of their shares of Clear Channel stock, up to a cap of $1.00 per
share. Shareholders who elected to receive the stock consideration
prior to the special meeting of shareholders held September 25, 2007
will have their shares of Clear Channel stock returned to them and
will be required to make a new election prior to the new special
shareholders' meeting. While the merger is expected to close by the
end of the third quarter 2008 pending shareholder approval, the
parties to the settlement agreement have agreed to extend the outside
date for completion of the merger to December 31, 2008.

As part of the settlement agreement, the banks in the syndicate
supporting the transaction have entered into fully-negotiated and
documented definitive agreements to provide long-term financing to
Clear Channel. The banks, the private equity investors, Clear Channel,
certain shareholders, and Bank of New York (serving as escrow agent)
have entered into an Escrow Agreement pursuant to which the private
equity investors and the banks have agreed to fund into escrow the
total amount of their respective equity and debt obligations, in a
combination of cash and/or letters of credit, within ten and seven
business days, respectively. Certain shareholders also have agreed to
deposit into escrow securities of Clear Channel that these parties
have agreed to exchange for Class A common stock of CC Media Holdings.
Following deposit of funds and other property into escrow, each party
to the merger related litigation pending in New York and Texas will
file all papers necessary to terminate the litigation, with prejudice.

The board of directors of Clear Channel has unanimously approved
the amended merger agreement and recommends that the shareholders
approve the amended merger agreement and the merger. The board of
directors of Clear Channel makes no recommendation with respect to the
voluntary stock election or the Class A common stock of the new
corporation.

The total number of Clear Channel shares that may elect to receive
shares in the new corporation will make up 30% of the new
corporation's equity and is expected to be approximately 30 million.
These shares would have a total value of approximately $1.1 billion
(at the $36.00 per share cash consideration) and represent
approximately 30% of the outstanding capital stock of the new
corporation immediately following the closing of the merger. The terms
of the merger agreement, as amended, provide that no shareholder will
be allocated more than 11,111,112 shares representing an estimated 11%
of the outstanding capital stock of the new corporation immediately
following the closing of the merger.

If Clear Channel shareholders elect to receive more than the
allocated number of shares of the Class A common stock of the new
corporation, then the shares will be allocated to shareholders who
elect to receive them on a pro-rata basis. Those Clear Channel
shareholders electing to receive shares of the new corporation will
receive $36.00 per share for any such Clear Channel shares that are
not exchanged in this manner. The election process will occur in
connection with the shareholder vote on the merger, and will be
described fully in an updated proxy statement and prospectus that will
be mailed to Clear Channel shareholders.

The merger agreement, as amended, which will require shareholder
approval, includes provisions limiting the fees payable to the private
equity group in the transaction, and requiring that the board of
directors of the new corporation at all times include at least two
independent directors.

The shares of CC Media Holdings to be issued to Clear Channel
shareholders who elect to receive them in exchange for their existing
shares will be registered with the Securities and Exchange Commission,
but will not be listed on any national exchange.

Goldman Sachs & Co. served as financial advisor to Clear Channel
on the transaction, and Akin Gump Strauss Hauer & Feld LLP served as
legal advisor to the company.

Mark P. Mays, the Chief Executive Officer of Clear Channel, said:
"We are very pleased to have reached this accord with our sponsors and
the banks funding the transaction. This revised agreement is a win for
our shareholders because it provides them with substantial value and
certainty while avoiding the delay and inherent risks associated with
complex litigation. Our shareholders will receive a significant
premium over recent stock price levels and can elect to continue to
participate in our future upside. Importantly, this agreement greatly
increases the certainty that the merger will close because all debt
and equity funds will be deposited in escrow until the transaction
closes. Clear Channel's business prospects will be enhanced further
through an improved capital structure that includes a lower debt load.
We appreciate greatly the support of our shareholders as well as the
loyalty and hard work of our dedicated employees over these many
months. We are eager to begin working with THL and Bain Capital, the
stellar team that will help us to fulfill our considerable promise."

John P. Connaughton, a Managing Director at Bain Capital, stated:
"We have been extremely pleased by our partnership with the Clear
Channel management team. We believe this agreement, and the definitive
long-term financing package the banks have agreed to provide, offers
clarity and confidence to Clear Channel's customers, employees and
partners. We look forward to supporting the continued global market
leadership, growth and success of the most innovative company in the
radio broadcasting and out-of-home media space."

Scott M. Sperling, Co-President of THL Partners, said: "We are
pleased to arrive at this resolution which enables us to complete the
acquisition of Clear Channel. We appreciate that the banks have
provided the company with the robust, long-term financing that will
allow Clear Channel to achieve its outstanding operational and growth
potential. We would like to thank all of the stakeholders who worked
to achieve this positive outcome, and we are looking forward to
working closely with our investment partners and with the entire Clear
Channel leadership team to execute on our plans to grow the company to
its full potential."

A representative of the bank group, Chad Leat, Chairman of the
Alternative Asset Group at Citi, said: "The Banks are very pleased to
have reached a constructive resolution of the matter. We look forward
to an expeditious closing of the revised transaction and want to
express our appreciation to all those who contributed to the solution.
We look forward to participating with our partners in Clear Channel's
continued success."

In connection with its support of a settlement, Highfields Capital
Management LP, which manages funds that beneficially own 7.7% of Clear
Channel's common stock, extended its Voting Agreement with entities
sponsored by the private equity group. Under the Agreement,
Highfields has agreed to vote in favor of the transaction and to
retain up to $400 million in equity of CC Media Holdings.
Additionally, the Agreement includes provisions assuring public
shareholders who elect to receive stock in the surviving entity that
they will receive equal treatment to the private equity
investors in dividends and other distributions, representation on the
Board of Directors of the surviving entity and have certain other
rights following completion of the merger.

Jonathon S. Jacobson, Senior Managing Director of Highfields,
said: "As the largest shareholder in Clear Channel, we saw an
opportunity to bring all parties together to remove the risk and
uncertainty of litigation and we are glad that a constructive and
mutually beneficial business solution could be reached. We fully
support this revised transaction." Richard L. Grubman, Senior Managing
Director of Highfields, added: "Clear Channel can now accelerate the
initiatives it has underway to capitalize on the strength of its
assets and drive profitability. We look forward to continuing to play
a meaningful role in ensuring the company is positioned to create
substantial long-term value."

Clear Channel will set a record date, time and place for a new
special meeting of shareholders after filing an updated joint proxy
statement/prospectus with the Securities and Exchange Commission.

Shareholders with questions about the merger or how to vote their
shares should call Clear Channel's proxy solicitor, Innisfree M&A
Incorporated, toll-free at 877-456-3427.

About Clear Channel Communications

Clear Channel Communications, Inc. (NYSE:CCU) is a global media
and entertainment company specializing in mobile and on-demand
entertainment and information services for local communities and
premiere opportunities for advertisers. Based in San Antonio, Texas,
the company's businesses include radio and outdoor displays. More
information is available at www.clearchannel.com.

About Thomas H. Lee Partners, L.P. ("THL Partners")

Thomas H. Lee Partners, L.P. is one of the oldest and most
successful private equity investment firms in the United States. Since
its establishment in 1974, THL has been the preeminent growth buyout
firm, raising approximately $22 billion of equity capital, investing
in more than 100 businesses with an aggregate purchase price of more
than $125 billion, completing over 200 add-on transactions and
generating superior returns for its investors. THL Partners focuses
its high value-added strategy on growth businesses, partnering with
the best managers in an industry to build great companies through
strong organic growth and targeted add-on acquisitions. Notable
transactions sponsored by THL include Aramark, Ceridian, Dunkin'
Brands, Experian, Fidelity National Information Services, Grupo ONO,
HomeSide Lending, Houghton Mifflin, Michael Foods, The Nielsen
Company, Nortek, ProSiebenSat.1, Simmons Bedding Company, Snapple,
Univision, Warner Chilcott, Warner Music Group and West Corporation.
For more information please visit www.THL.com.

About Bain Capital Partners, LLC ("Bain Capital")

Bain Capital (www.baincapital.com) is a global private investment
firm that manages several pools of capital including private equity,
high-yield assets, mezzanine capital and public equity with more than
$65 billion in assets under management. Since its inception in 1984,
Bain Capital has made private equity investments and add-on
acquisitions in over 300 companies around the world, including
investments in a broad range of companies such as Burger King, HCA,
Warner Chilcott, Toys "R" Us, Michaels Stores, Dunkin' Brands and
ProSiebenSat1 Media. Headquartered in Boston, Bain Capital has offices
in New York, London, Munich, Tokyo, Hong Kong and Shanghai.

About Highfields Capital Management

Based in Boston, MA, Highfields Capital is a value-oriented
investment firm which principally makes long-term investments in
public and private companies around the globe. It currently manages
over $11 billion of capital on behalf of college and university
endowments, charitable foundations and other philanthropic
organizations, high net worth families and individual investors.
Highfields invests in a wide variety of industries, securities and
financial markets. For further information, please visit
www.highfieldscapital.com.

Important Additional Information Regarding the Merger and Where to
Find It:

Clear Channel and CC Media Holdings will file with the Securities
and Exchange Commission (The "SEC") a joint registration statement on
Form S-4 that will contain a joint proxy statement/prospectus and
other documents regarding the proposed transaction. Before making any
voting or investment decisions, security holders of Clear Channel are
urged to read the proxy statement/prospectus and all other documents
regarding the acquisition, carefully in their entirety, when they
become available because they will contain important information about
the proposed transaction. Security holders of Clear Channel may obtain
free copies of the proxy statement/prospectus (when it becomes
available) and other documents filed with, or furnished to, the SEC at
the SEC'S website at http://www.sec.gov. In addition, a shareholder
who wishes to receive a copy of these materials (when they become
available), without charge, should submit this request to Clear
Channel's proxy solicitor, Innisfree M&A Incorporated, at 501 Madison
Avenue, 20th Floor, New York, New York 10022 or by calling Innisfree
toll-free at 877-456-3427.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements based on
current Clear Channel management expectations. Those forward-looking
statements include all statements other than those made solely with
respect to historical fact. Numerous risks, uncertainties and other
factors may cause actual results to differ materially from those
expressed in any forward-looking statements. These factors include,
but are not limited to, (1) the occurrence of any event, change or
other circumstances that could give rise to the termination of the
merger agreement; (2) the outcome of any legal proceedings that have
been or may be instituted against Clear Channel and others relating to
the merger agreement; (3) the inability to complete the merger due to
the failure to obtain shareholder approval or the failure to satisfy
other conditions to completion of the merger; (4) the failure to
receive the funds deposited into the escrow account; (5) risks that
the proposed transaction disrupts current plans and operations and the
potential difficulties in employee retention as a result of the
merger; (6) the ability to recognize the benefits of the merger; (7)
the amount of the costs, fees, expenses and charges related to the
merger and the actual terms of certain financings that will be
obtained for the merger; and (8) the impact of the substantial
indebtedness incurred to finance the consummation of the merger; and
other risks that are set forth in the "Risk Factors," "Legal
Proceedings" and "Management Discussion and Analysis of Results of
Operations and Financial Condition" sections of Clear Channel's SEC
filings. Many of the factors that will determine the outcome of the
subject matter of this press release are beyond Clear Channel's
ability to control or predict. Clear Channel undertakes no obligation
to revise or update any forward-looking statements, or to make any
other forward-looking statements, whether as a result of new
information, future events or otherwise.

Clear Channel Communications, Inc., San Antonio
Investors:
Randy Palmer, 210-822-2828
Senior Vice President of Investor Relations
or
Media:
Lisa Dollinger, 210-822-2828
Chief Communications Officer
or
Brainerd Communicators
Media:
Michele Clarke, 212-986-6667
or
for Bain Capital
Media:
Alex Stanton, 212-780-0701
or
for THL Partners
Media:
Matt Benson, 415-618-8750
or
for Highfields Capital Management
Andrea Calise, 212-521-4845

Copyright Business Wire 2008