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Investment outfit linked to Global Radio seeks approval to buy up to 49.99% of iHeart Media
By Chris Cooke | Published on Wednesday 17 March 2021
An investment vehicle with links to UK broadcaster Global has confirmed it is seeking permission from US media regulator the FCC to acquire up to 49.99% of American radio giant iHeart.
Global Media & Entertainment Investments is incorporated in the Bahamas and headed up by Michael Tabor, who is also a key backer of the main Global media company in the UK, and father of its President Ashley Tabor-King.
In a letter to the FCC, the Global investment outfit confirms it has acquired 8.7% of the publicly listed iHeartMedia. Because of US rules regarding the foreign ownership of media companies, iHeart has sought approval from the FCC for Global’s current equity holding, and also for it to increase its stake to 9.99%.
However, in its letter, Global says that it had previously requested that iHeart management seek approval for it to potentially increase its stake in the US business to 49.99%.
iHeart actually has its own rules that mean an investor needs board approval to take more than 9.99% of the company’s stock. But, Global argues in its letter to the FCC, that’s irrelevant in terms of the regulator pre-approving any future deal that takes its shareholding up to 49.99%.
With that in mind, Global is directly seeking FCC approval for any future iHeart share purchases that increases its overall stake above 9.99%, anywhere up to 49.99%, reckoning that that request “is fully compliant with the FCC’s rules, as well as the Commission’s stated policy goals of providing for the free transferability of the publicly traded stock of a company like iHeart and promoting increasing cross-border investment in media companies”.
Despite iHeart’s very public financial challenges in recent years – and the general consensus that the radio industry at large has plenty of challenges ahead – Global isn’t the only outfit interested in acquiring a sizeable slice of the US broadcasting giant. Last year it emerged that Liberty Media had got regulator approval to potentially increase its existing stake in the iHeart business to 50%.
In Liberty’s case, the regulator was the US Department Of Justice, the issue there being market dominance rather than foreign ownership, because Liberty already controls Sirius XM and Pandora in the US, as well as being the biggest shareholder in Live Nation.
UPDATE 17 Mar 2021, 3.00pm: Amended to note that Global had simply requested that iHeart seek permission for it to acquire up to 49.99% of the company. An earlier version said that Global and iHeart had agreed that that’s what the latter would seek when approaching the FCC.
