Remember November 16, 2006? Oil futures stood at $56 a barrel and Bear Stearns shares swapped for $155. It's also the day that the private equity firms Thomas H. Lee Partners and Bain Capital agreed to take Clear Channel Communications private for $18.7 billion.

Now, 16 months later, Bear Stearns is worth $2 per share and oil sells for $100. And unfortunately for the buyout firms, their relationship with the radio giant is one that has still not yet been consummated.

It took a full 10 months of wrangling over deal terms for the shareholders to finally give their okay to a new offer for $19.5 billion, or $39.20 per share, plus the assumption of $8 billion of debt.

Meanwhile, the housing market continued its free fall, subprime mortgages backfired in a big way, and the leveraged buyout bubble officially burst with the onset of a credit crisis.

But still, Bain and T.H. Lee pressed on.

As recently as last week, the deal's close looked temptingly within reach. The website Private Equity Hub reported that the limited partners behind the deal began wiring the capital to Bain and T.H. Lee for the equity piece of the deal. Clear Channel also closed on the $1.1 billion sale of its television unit to another private-equity-backed media company.

Now, it's up to the banks to market the debt, which is no easy feat in this environment. Citigroup is leading the deal, with Deutsche Bank, Morgan Stanley, Credit Suisse, Royal Bank of Scotland, and Wachovia lending portions of it as well. Fortunately for Clear Channel, Bear Stearns is conspicuously absent from that syndicate list.

The banks have until the end of next week to market the debt—if it isn't sold it will wind up on their own books. The Wall Street Journal reports that the banks are prepared to fund $22 billion to finance the transaction, but about $18 billion of it will be in senior secured loans, which are selling at about a 15 percent discount.

This means that the banks are set to lose $2.7 billion on the day the deal closes. If the banks choose to walk away from the deal instead, the private equity firms would be forced to pay a $500 million breakup fee and the banks could face litigation from the buyout firms, Clear Channel, or both. So the banks need to weigh the cost of potential litigation against an automatic $3 billion loss plus another load of hefty debt added to their balance sheets.

And just what does the rest of Wall Street think about this deal? Shares of Clear Channel shed nearly 10 percent of their value yesterday, although they've recovered some of those losses this morning. Still, the stock trades at about $33.50, which is well below the buyout offer of $39.20. 

That's a clear bet against the banks getting this deal done. Pay lawyers? Or pay for a struggling media firm with debt? For investors, anyway, the answer appears to be a no-brainer.