NEW YORK (Reuters) - U.S. broadcaster CBS settled its termination dispute with fired radio shock jock Don Imus on Tuesday, a possible step toward Imus reviving his multimillion-dollar career with a rival broadcaster.

Radio talk-show host Don Imus (L) speaks with Rev. Al Sharpton during Sharpton's radio show, in New York, April 9, 2007. CBS has settled its termination dispute with the fired shock jock, a company spokesman said on Tuesday. REUTERS/Chip East

Imus was fired in April after referring to a mostly black university women’s basketball team as “nappy-headed hos,” a racial slur that generated a storm of controversy and led CBS Radio to cancel his “Imus in the Morning” show.

“Don Imus and CBS Radio have mutually agreed to settle claims that each had against the other regarding the Imus radio program on CBS. The terms of the settlement are confidential and will not be disclosed,” CBS and Imus’s lawyer said in a joint statement.

The Imus show was produced and broadcast by CBS-owned WFAN radio station in New York and syndicated on some 60 stations across the country. The show was also simulcast on cable television’s MSNBC.

CBS and MSNBC first suspended Imus’s show for two weeks in April, but as calls to fire Imus grew, notably from New York civil rights leader Al Sharpton, MSNBC canceled the Imus show and CBS did so the next day.

“Nappy” is an antiquated term referring to coarse, curly hair and “ho” is slang for whore.

WFAN announced on Tuesday that Imus’s old morning time slot was being taken over by former NFL quarterback Boomer Esiason and talk radio host Craig Carton.

Imus had threatened to sue CBS for $120 million for breach of contract through his famed lawyer, Martin Garbus, who once represented politically incorrect comedian Lenny Bruce in the 1960s.

Garbus would only confirm a settlement had been reached, offering no other comment.

The Drudge Report Web site reported Imus would receive $20 million. CBS shares fell nearly 4 percent to close at $29.81 on the New York Stock Exchange on Tuesday.

WHERE NEXT FOR IMUS?

With the settlement done, focus shifted to who might hire Imus, who was on a 5-year, $40 million contract when fired.

Unconfirmed media reports have mentioned Sirius Satellite Radio and New York radio station WABC, which is owned by Citadel Broadcasting, as possible suitors.

But Steve Borneman, the general manager at WABC, said no one at WABC, Citadel nor ABC had been in talks with Imus.

“I wish Mr. Imus well, but we are happy with our morning show (hosted by Curtis Sliwa and Ron Kuby),” Borneman said.

A Sirius spokesman declined comment on Tuesday, but CEO Mel Karmazin, a former top executive at CBS, told Fox News Channel last week: “The fact that he had been fired wouldn’t stop me from having Don work for me again. He makes you a lot of money.”

Despite the negative publicity, Imus is capable of generating tens of millions of dollars in advertising revenue a year through high ratings, experts say.

“If someone is in negotiations with him, they have done enough due diligence with their advertisers to know revenues will increase and advertisers will support it,” said employment and entertainment lawyer Barry Peek, a partner in the law firm Meyer, Suozzi, English & Klein, P.C.

“I would think it’s going to be quick,” Peek said of an Imus comeback. “For Imus, time is of the essence. Out of sight, out of mind.”

In any case, Sharpton said he would be watching.

“Wherever he resurfaces, we at National Action Network and other groups will be watching and monitoring him,” Sharpton said in a statement. “Mr. Imus has the right to work but we have the right to make sure that this repeat offender does not return and continue what he has done historically.”