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October 22, 2007
Update on Harman buy out
Last month I posted a piece of the failed buy-out of Harman Industries. Here is the update --Deal Is Struck to End Harman Buyout - Mergers, Acquisitions, Venture Capital, Hedge Funds -- DealBook - New York Times:
Kohlberg Kravis Roberts and Goldman Sachs agreed to terminate their merger agreement with Harman International Industries on Monday and reinvest in the audio speaker company.
The settlement ends another dispute over an ailing deal, a situation that has cropped up with increasing frequency as the buyout boom has lost steam.
According to the terms of the deal, the buyout agreement struck in April will be dissolved, with no litigation or payment of a termination fee. Instead, Kohlberg Kravis and Goldman Sachs will buy $400 million of notes with a 1.25 percent interest payment, which are convertible at a price of $104 a share. (Shares in Harman closed at $86.40 on Friday.)
Brian F. Carroll, a member of Kohlberg Kravis, will also join Harman’s board. The company said it would use the proceeds to buy back stock.
Looks like KKR decided that Harman -- with all that R&D -- is a good investment after all. Or maybe they just want to avoid a messy lawsuit.
Posted by Ken Jarboe at October 22, 2007 10:50 AM
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