Silver Lake, ValueAct drop $3bn buyout

Silver Lake’s and ValueAct Partners’ $3 billion buyout of data company Acxiom is the latest in a series of deals to fall apart in the wake of the credit crunch.

Silver Lake and ValueAct Partners have dropped their planned $3 billion (€2.1 billion) acquisition of data company Acxiom due in part to “current market conditions”, an Acxiom spokeswoman said.

The two private equity firms will pay Acxiom a $65 million break-up fee, according to a statement.

Silver Lake and ValueAct could not be reached for comment.

The two firms agreed to buy Acxiom in May for $3 billion, including the assumption of $765 million in debt. UBS was to provide financing for the deal.

The deal is not the first to fall victim to the credit crunch. Last week a JC Flowers-led consortium said it expected to walk away from the $25 billion buyout of US student loan company Sallie Mae, citing material adverse changes in the lender’s financial standing. Kohlberg Kravis Roberts and Goldman Sachs also recently dropped their planned $8 billion acquisition of stereo maker Harman International Industries, also invoking a MAC clause.

Lone Star, a Texas-based private equity firm, invoked the MAC clause in its attempt to walk away from a $400 million agreement to buy subprime lender Accredited Home Mortgage. The mortgage company in turn sued the buyout firm to force the sale, which prompted Lone Star to offer to proceed with the buyout at a reduced price. The two firms eventually inked a $296 million agreement and dropped pending lawsuits.