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Expect a wild ride with Clear Channel Communications Inc. Wednesday, thanks to reports that the banks are close to killing the $22.1 billion buyout.
The Wall Street Journal, citing unnamed sources close to the deal, said that the banks lining up the financing had stalled the LBO due to a dispute with the equity sponsors over the details of the credit agreement. Bain Capital LLC and Thomas H. Lee Partners LP are paying $39.20 per share in the take-private that could close any day or that could also end in litigation as the lenders -- Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Credit Suisse Securities LLC, Morgan Stanley, Wachovia Bank and Royal Bank of Scotland plc -- negotiate for better terms. The Deal's Scott Stuart writes Wednesday in his Arbitrage column: The deal has been in its 25-business-day debt marketing period -- and a related negotiation between the buyers and the lenders. ... The end of the marketing period is upon us. The precise dates are tough to peg, in part because the clock begins when the sponsors and lenders have the "required information" for marketing the debt under 144A rules. The information must be available throughout the 25 days.Wall Street was clearly buying into the rumors as the spread on the deal widened even further in after-market trading as investors sent Clear Channel shares down by 20% to $25.83; following a $32.56 Tuesday close. - George White See Deal.com story on Clear Channel See Wall Street Journal report CategoriesPrivate capital video
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