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Phoenix Billboard Company Prepares For Public Offering

In 1997, Karl Eller sold his outdoor advertising company to Clear Channel Communications for $1.15 billion. The deal came just weeks before he planned to take Eller Media Corp. public in a $220 million IPO (initial public offering).

Today, the company that’s now known as Clear Channel Outdoor is preparing for another initial public offering as its parent company, Clear Channel Communications, works to restructure operations to raise capital and improve shareholder value.

Based in Phoenix, Clear Channel Outdoor has grown to operate more than 150,000 ad displays in 42 U.S. markets, plus South America, Mexico and Canada. The company also operates about 50% of the signage in New York City’s Times Square.

San Antonio-based Clear Channel, the country’s No. 1 radio station owner, announced this month it would conduct a public offering for 10 percent of the Clear Channel Outdoor’s stock. The company also plans to spin off its live entertainment subsidiary.

After the IPO, Clear Channel Outdoor’s global headquarters will be in San Antonio, not Phoenix. Mark Mays, Clear Channel Communication’s chief executive, is expected to be CEO of the Clear Channel Outdoor public entity.

Eller retired as Clear Channel Outdoor’s CEO in late 2001. He now runs his own consulting business in Phoenix called The Eller Company.

Eller said Clear Channel’s plans to offer the IPO aren’t surprising given the sector’s strength. He noted that the only other “pure” outdoor firm, Lamar Advertising Co. of Baton Rouge (LA), is successful as a public company. Lamar’s current price-earnings ratio (company’s current share price compared to its per-share earnings) is a robust 143!

The 10 percent offering of Clear Channel Outdoor, expected to be completed by the end of 2006, is expected to raise $350 million. It will trade on the NYSE under ticker symbol CCO.