Clear Channel buyers sue banks over $20 bln deal
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Wed, 26 Mar 2008 21:59:04 GMT |
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By Megan DaviesNEW YORK (Reuters) - The $20 billion leveraged buyout of U.S. radio operator Clear Channel Communications Inc on Wednesday descended into litigation as the private equity buyers sued the banks which had agreed to finance the deal to force them to complete the transaction.Thomas H. Lee Partners and Bain Capital Partners LLC said in a statement they filed complaints in New York and Texas against Citigroup Inc , Morgan Stanley , Credit Suisse Group , Royal Bank of Scotland Group Plc , Deutsche Bank AG and Wachovia Corp .Clear Channel is also joining THL and Bain in a complaint filed in Texas against the banks, to force completion of deal, the private equity firms said in the release.Clear Channel struck the $39.20-a-share deal to be bought by private equity firms Thomas H. Lee Partners and Bain Capital Partners LLC at the height of the private equity boom last year.But the market has changed significantly since then, with the cost of financing leveraged loan debt skyrocketing and banks unwilling to take losses on loans they agreed to finance in better times.Clear Channel's shares sank 17 percent to $26.87 on Wednesday, a day after it emerged that the deal was in jeopardy.(Reporting by Megan Davies; editing by Carol Bishopric, Richard Chang)
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