NEW YORK May 13 The parties in the dispute over
financing the $20 billion Clear Channel Communications Inc (CCU.N)
buyout on Tuesday reached an agreement in principle on settling
the case and striking a new deal at a lower price of $36 a share,
a source familiar with the situation said on Tuesday.
A deal is still to be finalized, the source cautioned, but an
announcement could come this afternoon, the source said.
Clear Channel struck the deal to be bought by private equity
firms Thomas H. Lee Partners [THL.UL] and Bain Capital at the peak
of the private equity boom last year for $39.20 a share. The
market has changed drastically since then, with the cost of
financing leveraged loans skyrocketing.
The deal descended into litigation this year when THL and Bain
filed complaints in New York and Texas against six Wall Street
banks -- Citigroup Inc (C.N), Morgan Stanley (MS.N), Credit Suisse
Group CSGN.VX, Royal Bank of Scotland Group Plc (RBS.L),
Deutsche Bank AG (DBKGn.DE) and Wachovia Corp WB.N -- to enforce
their agreement to fund the buyout.
A trial, set to begin on Monday in New York State Court, was
delayed until Tuesday morning and then adjorned until 2pm (1800
GMT) Tuesday. Trial testimony began this afternoon, with an
employee of Bain Capital undergoing questioning
(Reporting by Megan Davies, additional reporting by Leslie
Gevirtz; editing by John Wallace, Phil Berlowitz)