Harman Reaches Settlement With Equity Firms
While Kohlberg Kravis Roberts and Goldman Capital Partners have pulled out of their $8 billion deal to acquire Harman International, the two private equity firms will still invest $400 million in convertible notes, so that the company can buy back stock under the terms of a settlement, Reuters reported Monday.
As a result of the deal, according to the report, Harman will not sue the two firms, nor will they have to pay a termination penalty, which the original deal placed at $225 million. In addition, KKR’s Brian Carroll will join Harman’s board of directors.
KKR and Goldman had backed out of the proposed merger in July, citing an “adverse material change” in the company’s business. Since the breakup, Harman has been threatened with several class action suits.