The business stories that matter, by Fortune's Colin Barr
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January 17, 2008, 4:46 pm

No one believes Alliance Data

Alliance Data (ADS) says its private equity buyout is still on, but no one seems to believe it. The Dallas-based computer company issued a press release late Thursday saying it believes its agreement to sell itself to Blackstone (BX) for $81.75 a share, or $6.4 billion, is intact. “The company believes that the transaction financing remains fully committed by the banking group,” Alliance Data said. “The company and Blackstone are continuing to work together to close the deal as quickly as possible.”

Of course, it’s understandable that investors might believe the deal is in jeopardy, given that the buyout price is half again as much as Alliance Data’s closing stock price Thursday of $52.82. Indeed, Alliance Data’s shares have continued to plunge over the past month even as the company has repeatedly issued statements standing by the deal, which was reached in May. But DealBook at The New York Times reported earlier Thursday that the deal is on track, according to people briefed on the situation. Maybe investors just can’t bring themselves to believe Blackstone would get such a lousy deal for itself.

Because you can buy at a 36% discount to the orginal price. You must pay retail on autos.

Posted By Dave, Lexington, Ky : January 18, 2008 9:20 am

raytoei,

i guess my thought is that it’s a lousy deal to pay $82 for something you can buy in the market for $53. but maybe i’m missing something.

Posted By Colin Barr : January 17, 2008 8:00 pm

“Maybe investors just can’t bring themselves to believe Blackstone would get such a lousy deal for itself.”

Why is this a lousy deal ?

Posted By raytoei, an arb : January 17, 2008 5:26 pm
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Colin Barr covers business and finance for Fortune.com. Previously he was an editor at TheStreet.com and author of the weekly Five Dumbest Things on Wall Street column, and an editor at Dow Jones Newswires.
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