Clear Channel Outdoor Holdings Prices Senior Note Offering

Clear Channel Outdoor Holdings Inc.'s CCO indirect wholly-owned subsidiary, Clear Channel International B.V. priced a senior note offering worth $225 million in aggregate principal amount.

The 8.75% senior notes, which will fall due in 2020, will be issued under an indenture dated Dec 16, 2015 and are being offered only to "qualified institutional buyers". The sale of the notes is expected to be completed on the same day, subject to the satisfaction of certain customary closing conditions.

The notes were priced at 99.012% of par, and will be guaranteed by some of Clear Channel International's existing and future subsidiaries. Clear Channel Outdoor Holdings is not guaranteeing or assuming any liability for the notes. In right of payment, the senior notes will be ranked equal with unsubordinated indebtedness of Clear Channel International.

The net proceeds generated from the note issuance will be used by Clear Channel International to give a loan of $225 million to Clear Channel CV, which is an indirect parent of Clear Channel International and a subsidiary of Clear Channel Outdoor Holdings. The loan will fall due in conjunction with the payments under the notes issue, and under the same terms as well.

Subsequently, Clear Channel CV will likely use the proceeds from the loan to repay a loan due to Clear Channel Worldwide Holdings, Inc., ("CCWH") — also an indirect parent of Clear Channel International and a subsidiary of Clear Channel Outdoor Holdings. Any leftover proceeds will be distributed to the same entity.

The same proceeds will be given to Clear Channel Outdoor Holdings as indirect distributions by CCWH. Clear Channel Outdoor Holdings will then use the funds to finance a special cash dividend of roughly $217.8 million to its shareholders.

Clear Channel Outdoor Holdings presently carries a Zacks Rank #3 (Hold). Other semiconductor players that are worth a look now include Marin Software Incorporated MRIN and YuMe, Inc. YUME, both sporting a Zacks Rank #1 (Strong Buy), and Harte-Hanks Inc. HHS holding a Zacks Rank #2 (Buy).

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