UPDATE 1-Buyout of Clear Channel gets US antitrust approval

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WASHINGTON, Feb 13 (Reuters) - U.S. antitrust authorities said on Wednesday they had conditionally approved the proposed buyout of U.S. radio operator Clear Channel Communications Inc (CCU.N: Quote, Profile, Research) by two private equity firms.

The Justice Department said it would not oppose the $20 billion acquisition of San Antonio, Texas-based Clear Channel by Bain Capital Partners and Thomas H. Lee Partners, as long as Clear Channel divested radio stations in four U.S. cities.

Under an agreement with the department, Clear Channel will divest radio stations in Cincinnati, Houston, Las Vegas and San Francisco.

The private equity firms already had "substantial ownership interests" in two firms that compete with Clear Channel in those cities, the department said.

Without the divestitures, advertisers that rely on radio advertising in those cities likely would have faced higher prices, the department's antitrust chief, Thomas Barnett, said in a statement.

The deal got the endorsement of regulators at the Federal Communications Commission on Jan. 24

However, a weakening economy and credit crunch has provoked speculation the buyout agreed in May last year may be in jeopardy. Clear Channel shares have traded well below the $39.20-a-share deal price in the past three weeks.

In extended trading on Wednesday, the stock rose 4.3 percent to $30.75, after closing at $29.49 in regular trading on the New York Stock Exchange. (Reporting by Diane Bartz; Editing by Tim Dobbyn)