In yet another symptom of the credit crunch challenging our economy, Harman International recently learned that its buyout deal may be stalling.
Today's Wall Street Journal indicated that the private-equity buyers, lead by Kohlberg Kravis Roberts and the private-equity arm of Goldman Sachs (GS), may be hesitating to follow through with their $8 billion purchase of Harman, which manufactures audio equipment.
The acquisition was originally approached in April, when the buyout craze was sweeping the nation. But the elusive people familiar with the matter believe that those holding the cash have soured on the transaction, according to the Journal. Reports suggest that one of the buyers may have discovered new information that makes the buyout deal less attractive, but there are no further details at this time.
Last month, HAR officials had estimated that the deal would close in the third of fourth quarter of this year. If KKR and Goldman do abandon the buyout, they will have to pay a $225 million termination fee, equal to about 2.86% of the deal's value.
HAR has plunged more than 13% today; GS shares are 1.4% higher.