There's been quite a bit of drama with the The Blackstone Group L.P. (NYSE: BX)'s proposed $6.4 billion buyout of Alliance Data Systems Corporation (NYSE: ADS). In fact, in January, ADS filed a lawsuit against Blackstone (but it was quickly dropped).
However, things got a little easier today (according to a piece in the Wall Street Journal, which is a paid publication). That is, the Office of the Comptroller of the Currency said it will place a cap on the liability for Blackstone if ADS's credit card segment implodes (up to $400 million). Hey, in light of the turbulence in the financial markets, this is certainly a material issue and should be a relief for Blackstone.
Of course, there are still other issues, such as the credit crunch and the slowing economy. Such things make it difficult to justify a deal for ADS.
Yet, in today's trading, ADS's shares spiked 17% to $52.22. Then again, the buyout offer is still at a hefty $81.75. In other words, the Street thinks that -- if this deal gets done -- expect a much lower price.
Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements
. He also operates DealProfiles.com.

Back on May 17, 2007, there was another typical multi-billion dollar private equity deal. That is, 


million. Analysts had been looking for 66 cents and $500.5 million. Management also issued upside guidance for Q1 earnings and essentially in-line guidance for FY07 results. The CEO cited "increased visibility into 2007" for the solid view forward. JMP Securities subsequently reiterated its "market outperform" rating on the shares and boosted its price target to $80. The news kept ADS shares cycling through a positive 15-week trading channel. The price is currently consolidating at the base of that channel, where oversold Momentum, CCI and MACD technical parameters suggest the potential for a rise back toward the top. Correspondence of the stock's 90-day moving average to the base of the channel backs the rebound notion.








