updated 2/13/2008 9:40:25 PM ET 2008-02-14T02:40:25

The Justice Department on Wednesday approved the $19.5 billion sale of Clear Channel Communications Inc., the largest U.S. operator of radio stations and the world's largest billboard company.

The approval of the sale to a group of investors led by private equity firms Bain Capital and Thomas H. Lee Partners is the final regulatory hurdle for a deal that initially struggled to get shareholder approval. The deal, which allows some shareholders to continue owning a minority portion in an unusual equity buyout structure, is expected to close by March 31.

DOJ is requiring the private firms to sell six radio stations in Cincinnati, Houston, Las Vegas and San Francisco to address anticompetitive concerns. The firms currently own stakes in other radio stations in those markets, the department said.

Without the sale, "advertisers that rely on radio advertising in the affected cities likely would have faced higher prices," said Thomas O. Barnett, Assistant Attorney General in charge of the Department's Antitrust Division.

Bain and THL already own interest in Cumulus Media Partners, another large radio station operator, and THL has an ownership stake in Univision Communications Inc., a large Spanish broadcaster.

The sale requirement by DOJ is separate from an agreement reached last month with the Federal Communications Commission, requiring the sale of radio stations in 42 markets.

San Antonio-based Clear Channel grew into a media giant following a 1996 law that eliminated the national limit on how many radio stations a single company may own. But the radio business, which now includes 833 stations, has struggled in recent years as competitors like satellite radio and digital music players have siphoned off listeners and hurt advertising sales.

The outdoor sign business has grown, however, with more interest in digital displays and billboards that are harder to skip. The company owns 973,000 outdoor signs worldwide.

Shares of Clear Channel fell 5 cents Wednesday to close at $29.49. In after-hours trading, the stock climbed $1.31, or 4.4 percent, to $30.80.

The stock has been trading far lower than the $39.20-per-share offer from the equity firms as investors have speculated that the tightening credit markets will make it more difficult for the equity firms to get the financing needed to close such a large deal.

But Chief Executive Mark Mays said in a statement Wednesday that the company is pleased with the DOJ approval, and "the merger continues on track for a first quarter close."

The company was scheduled to release its fourth quarter earnings on Thursday.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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