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Bain Capital, THL sue banks for failure to finance Clear Channel deal27/03/2008. Source: AltAssets. 
 Bain Capital Partners and Thomas H. Lee Partners have filed complaints in the Supreme Court of the State of New York and the Texas State Court in Bexar County, Texas, against Citigroup, Morgan Stanley, Credit Suisse, The Royal Bank of Scotland, Deutsche Bank and Wachovia to enforce binding commitments by the banks to provide debt financing for the private equity firms' acquisition of Clear Channel Communications, a specialist in the out-of-home advertising industry.
Clear Channel has joined the firms as a plaintiff in the Texas complaint.
Last year Bain and THL Partners agreed to acquire Clear Channel in a transaction valued at approximately $26.7bn, including the assumption or repayment of $8bn of net debt.
Bain Capital and THL Partners said in a joint statement, 'We are disappointed and dismayed that the banks have chosen not to fund the transaction under the terms of the binding commitments they entered into almost a year ago. It seems clear that lenders' remorse set in when credit markets worsened. Now they are trying to walk away from their commitment letter which clearly states that they bear all the risk that conditions in the debt markets might change. The banks are attempting to do so by changing the deal in ways no responsible purchaser could ever accept - replacing an extended, long-term financing package of at least six years that they have been committed to all along with a short-term three-year bridge financing.
'We have invested 18 months of time and effort to own Clear Channel. We want to do this deal,' the firms added.
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