Clear Channel ( CCU) traded higher after the two private-equity firms trying to acquire the media company rejected a bid by the financing banks for arbitration.

Bain Capital and Thomas H. Lee Partners are attempting to take Clear Channel private in a $19 billion deal, but the pact has been a tangled saga since it was signed in December 2006, with disputes arising about price, the sale of certain assets and financing arrangements.

"This proposal is yet another disingenuous attempt by the banks to avoid living up to their commitments," said a representative for the prospective buyers in an emailed statement. "The banks want to move this case into the back room because they fear that a public trial will clearly expose their misconduct."

The buyout firms added that they are ready to complete the deal on the initial terms made more than a year ago. The firms said a New York court hearing on April 24 will give them a further opportunity to reveal more concerns about the banks' thinking.

Citigroup ( C), Morgan Stanley ( MS), Wachovia ( WB), Credit Suisse ( CS), Deutsche Bank ( DB), and the Royal Bank of Scotland ( RBS) are in the syndicate.

Shares of Clear Channel were rising $1.50, or 5.3%, to $29.99, but are more than 20% below the planned $39.20 buyout price.

Earlier this month, a federal judge ordered a Texas court to again hear the case between the buyout firms and the six banks. The banks involved in the financing of the deal had lobbied to have the suit moved from the Texas district court to a federal court in hopes of finding a friendlier judge.

Before that, Bain and Thomas H. Lee won a temporary restraining order against the banks after a Texas judge ruled Clear Channel would face irreparable damage if funding was refused. Despite fears the banks will wiggle their way out of the financing, the private-equity firms insist they will press on with the deal.

In late March, Clear Channel's merger partners filed breach-of-contract suits against the banks. The firms claim the banks have made changes to their initial contract that tighten credit restrictions and could eventually cause Clear Channel to go into default. Clear Channel has joined the firms as a plaintiff in one of the suits.

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