March 2008
Clear Channel Communications, Inc., joined by CC Media Holdings, Inc., a unit of Thomas H. Lee Partners, L.P. and Bain Capital Partners, LLC, sued the banks who had committed to financing the debt connected to their $26 billion merger for tortious interference. The lawsuit, filed in Bexar County, Texas, alleges that the banks are "refusing to execute necessary documents in an overt effort to 'run out the clock' and cause [their] merger agreement to collapse" and are "fabricating false reasons to refuse to proceed with the transaction – all in an effort to deprive Plaintiffs’ of their vested contractual rights under the Merger Agreement which Defendants know must close by June 12, 2008."
Adding that the opportunity for CC Media Holdings to acquire Clear Channel is "uniquely valuable and irreplaceable", the suit further claims that the banks' recent actions create "immeasurable damages exceeding the parties' agreement for $26 billion".
The defendants are Citigroup, Morgan Stanley, Credit Suisse, RBS, Wachovia, and Deutsche Bank.
“The financial risk to the banks in this suit dwarfs any risk they think they have in funding the debt,” said Mark Mays, CEO of Clear Channel Communications. “The behavior of these banks is irresponsible, unprofessional and unjustified. The Defendants have made clear that they are determined, by any means possible, to destroy the merger and thus avoid their obligation to fund, as they are required legally to do.”
Bain Capital and THL Partners issued the following joint statement: “We want to do this deal. We are ready to close, have funded the equity portion of the purchase consideration, maintain our enthusiasm for the investment, and are fully prepared to fulfill our contractual obligations to complete the deal.”
Want to see what 24 hours of creative awesomeness look like? Click here.
This news message is supported by The Creative Finder, an online platform for photographers, illustrators, designers, and art directors to promote their portfolios towards new clients and collaborators. Creatives who wish to sign up for an account can save 10% off annual fees with promo code 'designtaxi'.
