The transaction would be one of the biggest deals in which a company has been taken private, and showcases the vast sums that buyout groups have been able to assemble to acquire public companies.
An investor group led by Thomas H. Lee Partners LP and Bain Capital Partners LLC is paying $37.60 in cash for each share of Clear Channel, a 10.2 percent premium over its closing price on Wednesday. The buyers are also assuming about $8 billion in debt.
San Antonio-based Clear Channel's shares jumped $1.33, or 3.9 percent, to $35.45 in afternoon trading on the New York Stock Exchange after rising earlier to a new 52-week high of $35.88.
The company said in a regulatory filing that it doesn't expect any senior management changes or significant layoffs.
Mark Mays will remain CEO while Randall Mays, his brother, will stay on as chief financial officer. Their father, chairman Lowry Mays, will continue to have an active role, the company said.
"Clear Channel is an exceptional media franchise that is well-positioned to grow thanks to the solid foundation the Mays family has created," John Connaughton, a managing director at Bain Capital, said in a statement.
It's not yet clear how much the Mays' stand to make in the deal. Clear Channel said Thursday that three members of senior management agreed to "significantly" reduce payments that would be made on a change of control.
A Clear Channel spokeswoman declined to elaborate. The Mays family owns about 7 percent of the company.
James Goss, media and entertainment analyst for Barrington Research, said the price of $37.60 was in line with expectations.
"I don't think there's anything that's happened that's been totally surprising," Goss said.
Clear Channel also said it plans to sell 448 of its radio stations, all located outside the top 100 markets, as well as its 42-station television group, which also are located in smaller markets. Collectively the properties made up less than 10 percent of the company's revenues last year.
The acquisition is not dependent on the sale of those assets, the company said.
Clear Channel owns or operates 1,150 radio stations and is the largest operator of radio stations in the country.
The company has until Dec. 7 to solicit competing proposals. Another bid for Clear Channel had been expected from Providence Equity Partners, the Blackstone Group and Kohlberg Kravis Roberts & Co.
Kit Spring, an analyst for Stifel Nicolaus & Co. Inc., wrote in a note that shareholders should reject the initial offer.
"(Clear Channel's) assets could command a much higher price if sold piece by piece, in our view," the note said.
Moran said the other "wild card" in Thursday's announcement was the fate of Clear Channel Outdoor, a major operator of billboard and bus-stop ads. Clear Channel owns a majority of the outdoor business, which trades separately.
Outdoor advertising company JCDecaux last week expressed interest in acquiring Clear Channel Outdoor.
Thursday's announcement doesn't include any provisions for taking Clear Channel Outdoor private, the company said.
The company's directors have approved the agreement, with the board insiders recused from the vote.
Once stock market darlings, radio stocks have fallen out of favor on Wall Street in recent years amid sluggish advertising revenues and competition from the boom in portable listening devices like Apple Computer Inc.'s iPods and the emerging growth of satellite radio.
Since January 2000, Clear Channel stock has fallen from a high of more than $91.
Clear Channel has instituted several measures to try to win back listeners, including cutting back on the number of commercials. However other operators have yet to embrace its "less is more" strategy.
Clear Channel was founded in 1972 and benefited greatly from the loosening of media ownership rules, which allowed more radio stations to be held by a single owner in each market.
The deal would rank behind KKR's 1988 buyout of RJR Nabisco Inc., which still is the biggest going-private deal ever at $25.1 billion. It would also trail two other deals announced earlier this year. Those included the $21.8 billion buyout of airport development company BAA PLC and the $21.3 billion buyout of hospital company HCA Inc.
Clear Channel said it expects to close the acquisition by the fourth quarter of next year.