RESTON, Va. - The group of suitors walking away from the $25 billion takeover of Sallie Mae have agreed to waive a provision in the contested acquisition offer and allow the student loan giant to solicit other offers.
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The group is grappling with Sallie Mae in Delaware Chancery Court, where the company is asking the court to enforce a $900 million break-up fee under the takeover agreement.
The group, led by private equity fund J.C. Flowers & Co. and banking giants JP Morgan Chase and Bank of America, say the recent passage of student loan reforms that will cut lender subsidies by billions of dollars amount to a material adverse affect allowing them to terminate the $60-a-share deal.
