A group of six banks, sued over the buyout of Clear Channel Communications Inc., asked a New York state court on Monday to hear their request to dismiss the claims against them.
Private equity firms Thomas H Lee Partners and Bain Capital Partners filed complaints last week against Citigroup Inc., Morgan Stanley, Credit Suisse Group, Royal Bank of Scotland Group Plc., Deutsche Bank AG and Wachovia Corp. to force completion of the pending $20 billion buyout of Clear Channel, the U.S. radio operator.
The parties claim the banks balked at providing financing when the debt markets deteriorated and asked for a change in terms of the deal that prevented it from being completed.
"Plaintiffs have presented no basis for litigation, much less proceeding in an expedited manner," the banks said in a document filed in New York State Supreme Court.
The private equity firms filed the lawsuits in New York and Texas last Wednesday, and Clear Channel was later granted a temporary restraining order against the banks that prevents them from reneging on their funding commitments.
The banks were to provide more than $22 billion financing and earn more than $400 million in fees.
A spokesman for the banks said there is "sufficient time" for the private equity firms to return to the negotiating table to work toward an agreement on final documentation.
"Unlike the sponsors, we have consistently negotiated the open items in good faith," the spokesman said.
"And in fact were still doing so when without warning the sponsors took the unproductive step of asking a court to intercede in our discussions only hours after sending us revised terms to review."
