The Clear Channel banks today offered to enter into binding arbitration with Bain Capital and Thomas H. Lee Partners, in order to reach resolution of their dispute. This is the type of lifeline you throw after being slapped silly by the courts, and continues to illustrate the banks’ willfull refusal to acknowledge primary culpability in this mess.
In their arbitration offer, the banks again say that they were all set to do the deal, until the private equity firms initiated litigation. Really? Then why didn’t the banks just walk into court with a check big enough to finance the buyout, under the condition that Bain and THL drop their complaints? Take a cookie if you know the most obvious of answers.
At what point do the Clear Channel banks fess up to their own mistake, and accept the consequences? Could you imagine a baseball team calling for contract arbitration after a player’s deal is signed? Or a vendor raising the price after delivery and use? Of course not. Only on Wall Street would such behavior be acceptable. Hopefully the courts will continue to agree.
Here is a copy of the arbitration request: ClearChannelLetter.pdf