US media regulator the Federal Communications Commission has given the all clear for an investment entity linked to UK radio giant Global to acquire up to 14.99% of the shares in American radio giant iHeart.
iHeart approached the FCC earlier this year regarding Global Media & Entertainment Investments, an entity incorporated in the Bahamas and headed up by Michael Tabor, who is also a key backer of the main Global radio company in the UK, and father of its President Ashley Tabor-King.
At that point, GMEI had already bought more than 5% of the iHeart company - controlling approximately 6.6% of total equity and 8.7% of voting interests. That needed the FCC's approval because of US rules regarding the ownership of media by foreign entities. It was also known that GMEI was interested in acquiring additional iHeart stock, so approval was sought for both past and future share purchases by the UK-linked investment vehicle.
However, there was a disagreement between iHeart and GMEI about just big a future share purchase should be pre-approved. GMEI said it was interested in acquiring anywhere up to 49.99% of the iHeart business and that it therefore wanted FCC approval now for it possibly buying such a big slice of the American company down the line.
However, iHeart itself sought approval for a more modest GMEI total share grab, initially 9.99%, later amended to 14.99%.
That led to GMEI directly seeking FCC approval for any possible share buying spree that would take its interest in iHeart up to the 49.99% point. However, last month legal reps for the investment outfit announced they were no longer seeking that direct FCC approval.
Meanwhile, the permission sought via iHeart was granted earlier this week, ie pre-approving any bid by GMEI to increase its stake in iHeart to 14.99%. The regulator said that it considered iHeart's proposal to allow such a thing to be in the public interest.
Specfically, it said, allowing GMEI to increase its share-holding in the future is "likely to enable iHeart greater flexibility to access foreign investment capital, thereby allowing iHeart to better compete with other media companies, enhance its programming, and better serve the public interest".