Does a new law that will reduce subsidies constitute a material adverse change? Fortune notes that Wall Street analysts predicting the new law will reduce earnings by 6 percent at most. Which isn't all that much. On the other hand, J.C. Flowers doesn't necessarily need to show the law will have a huge effect for the clause to be invoked. It all seems like bargaining. Do J.C. Flowers. J.P. Morgan and Bank of America really want to walk away and pay the $900 million reverse break up fee? Or do they just want a lower price. I had been assuming the latter, but I guess we'll soon find out. Meanwhile, there are rumors that another suitor could emerge, notably the Blackstone Group. As the deal environment improves, this is possible. Stay tuned.  

For more:
- here's the Fortune article

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