Clear Channel Settles SEC Probe Over Chinese Subsidiary Bribery Charges

Clear Channel Outdoor Holdings, Inc. CCO finalized a settlement with the U.S. Securities and Exchange Commission. 

The company has agreed to pay the SEC approximately $26.1 million in disgorgement, civil penalties, and pre-judgment interest.

The resolution pertains to a probe involving the U.S. Foreign Corrupt Practices Act, connected to its former indirect, non-wholly-owned Chinese subsidiary, Clear Media Limited.

"The SEC resolution pertains to the actions of Clear Media in China, and to the Company's oversight of that entity prior to the Company's previously-announced sale of its entire interest in Clear Media in April 2020," Clear Channel Outdoor said in a release.

In the second quarter reported last month, the company said that its corporate expenses soared a whopping 47.3%, driven by expenses recorded for an estimated legal liability related to the China investigation.

The amount will be paid in a series of installments over the following year. As of June 30, 2023, Clear Channel Outdoor Holdings had recorded a liability for the total amount of the potential settlement in anticipation of such settlement. 

The company exited Q2 with $232.9 million of cash on its balance sheet, with net debt of $5.357 billion.

In connection with the recent settlement, the U.S. Department of Justice has declined to pursue any charges against the company.

Resolving these legacy matters is important to the company, which believes this settlement is in the best interests of the company and its shareholders, Clear Channel Outdoor Holdings added.

Price Action: CCO shares closed higher by 6.54% at $1.63 on Thursday.