Broadcasters Create Minority Investment Fund

Broadcasting executives announced an investment fund Wednesday aimed at spurring ownership of television and radio stations by minorities and women.

Led by CBS Corp. chief Mel Karmazin and the head of Clear Channel Communications Inc., Lowry Mays, the industry initiative already has $175 million in cash commitments. Officials said that translates into $350 million in purchasing power available to minorities and women with experience in the industry.

Participants hope the fund eventually will have $1 billion in purchasing power once other industry members, institutions and pension funds also contribute.

“This is a big deal,” Karmazin said at a news conference. “A billion dollars is not chump change.”

The announcement of the independent, for-profit fund comes amid heightened concern that the wave of mergers in the broadcasting industry could limit further diversity of ownership.

Karmazin and Mays, each of whom is in the midst of a mega-merger, brushed off suggestions that the fund is meant to sway regulators who are reviewing their deals. CBS is trying to win approval to complete a proposed $36-billion marriage with Viacom Inc., and Clear Channel is seeking the go-ahead for its deal to buy AMFM Inc. for nearly $17 billion in stock.

The company chiefs called this a cynical view of their efforts.

“It is possible to do things because it is the right thing to do,” Karmazin said. Mays did say he hoped divestitures resulting from Clear Channel’s deal with AMFM would benefit minority owners.