Geneva - Credit Suisse and Deutsche Bank and have reached a deal to end all litigation against them by the Huntsman Corp., which had been suing the banks for over 4.6 billion dollars.

The settlement was for 1.7 billion dollars in cash and financing. Credit Suisse and Deutsche Bank would each pay Huntsman 316 million dollars and each provide 550 million of loans over a period of seven years.

Huntsman, a chemicals company, had sued the two European financial giants in a Texas court, saying the two banks ruined its proposed mergers with Hexion Chemical and Basell Holdings.

Credit Suisse and Deutsche Bank were supposed to finance the deals in 2007, but eventually backed away, as the credit crunch was kicking in. They said the combined company would be insolvent and claimed they had a right back off based on a clause in the contract.

"While we believe strongly in the merits of our case, we felt it was in our best interests to resolve the litigation for 316 million dollars each. We are pleased to have the litigation behind us," the two banks said in a statement.

The hearings in the case, in which Huntsman had claimed the banks committed tortious interference and fraud, began earlier this month.

"This settlement with the banks marks a very successful conclusion to this litigation for the company and all of its stakeholders," Peter Huntsman, the company head, said in a statement.

His firm, which has been suffering in the downturn, would use the cash to pay off its debt and securities which were about to come to term.(dpa)