Deal Or No Deal At Sallie Mae
The NY Times reports that there's a lot of buyer remorse apparently going on over the deal to take Sallie Mae private.
Lots of people close to the deal tell the paper "the buyers -- the private equity firms J. C. Flowers & Company and Friedman Fleischer & Lowe, as well as two banks, JPMorgan Chase and Bank of America -- met Tuesday to discuss the best way to pressure Sallie Mae into accepting a lower price."
Problem is, Sallie could play hardball.
That would force the buyers to either pay a $900 walk away fee.
Or they could go to court and try to argue that congressional action to reduce subsidies to student lenders represents enough of a material change to warrant a dissolution of the agreement.
Sallie is already on record saying it doesn't think the legislation -- soon to be signed by President Bush --- represents such a change.
This saga has been going on since the credit crunch hit the markets. Will the two sides dig in, or negotiate a new deal, like other firms have done?
Please email us to report offensive comments.
The comments to this entry are closed.