NEW YORK (AP) _ Clear Channel Communications Inc. said the private equity firms trying to buy the company may not be able to close the deal on time because their banks will not provide financing, according to a Friday regulatory filing.
The warning comes a day after a Texas judge issued a restraining order effectively preventing the banks from backing out of their commitment to finance the $19.5 billion deal, which was slated to close by Monday.
The private equity firms, led by Bain Capital and Thomas H. Lee LLC, met with the radio station operator Thursday. They indicated they were "ready, willing and able to consummate the merger and that each of the sponsors was prepared to fund their respective equity commitments," according to a Clear Channel filing with the Securities and Exchange Commission.
Shares of the San Antonio-based company fell 2.4 percent, or 71 cents, to $28.89 at the open of trade.
But the firms told the radio station operator "they would not be able to consummate the merger at that time due to the failure of the banks to provide the required financing."
The banks include Citigroup Inc., Morgan Stanley, Credit Suisse Group, The Royal Bank of Scotland, Deutsche Bank AG and Wachovia Corp.
Clear Channel said it cannot provide an expected closing date and "cautions the markets that a closing may not occur."
Copyright 2008 The Associated Press.