Updated: More Layoffs At Clear Channel; Up To 1,000 People This Time
This story was written by Rory Maher.
Radio behemoth Clear Channel (NYSE: CCU) is laying off more employees today as it struggles with declining ad revenue and a mountain of debt taken on in a buyout by private-equity firm Bain Capital and Thomas Lee Partners. The company may let go as many as 1,000 employees, or more than 6 percent of its staff. (Earlier today, the company had said about 590 people would lose their jobs, but the CEO later said on an internal conference call that the number would be closer to 1,000.) A person familiar with the situation said most of the cuts are occurring in programming and were primarily in small and mid-sized markets. Today's move follows layoffs of 1,850 employees, or about 9 percent of the workforce, just 3 months ago, mostly across its sales department.
As we've reported , Clear Channel began to run into trouble at the end of 2008 after loading up on $17 billion in debt to finance the acquisition by Bain Capital and Thomas Lee Partners. Revenues then declined in the weak economy. Radio industry revenue dropped 9 percent in the fourth quarter, and many believe the sector will have a hard time getting back on its feet even after the economy recovers because of the migration of listeners and advertisers to alternate media like the internet and satellite radio.
By Rory Maher