Unless a fundster was out of Blackberry and satellite range while on a yacht during the past two weeks, the recent turmoil in the credit market is no longer news. What is a surprise, though, is that even gold-plated PE deals -- such as the $5.75 billion play Madison Dearborn Partners is making for Nuveen Investments -- are coming under a smidgeon of doubt. Well, at least the shadow of doubt moved closer last week before receding, somewhat.

Madison Dearborn bid $65 a share for Nuveen on June 21. Last week, after a 30 day search, Nuveen's board told shareholders that it had not found any other takers and scheduled a shareholder vote on the deal for September 18.

In a typical period, the deal would be as good as done. But, the past three weeks have been anything but typical.

After trading above $62 during the initial weeks after Madison Dearborn and Nuveen announced the deal, the stock has recently fallen to below $61. The gap between the $65 offer and the current trading price reflects Mr. Market's faith in the two sides eventually consummating the deal.

Since late July, that faith seems to have been slipping.

Nuveen's board filed the proxy notice on Tuesday to inform shareholders of the upcoming vote.

Yet by Thursday the stock was caught in a market-wide downdraft shortly after lunch. That downdraft pulled Nuveen's shares all the way to $57.95 (see JNC quote). Coincidently, that move down came at the same time the market reached its low for the day. By Thursday afternoon the market was rallying, and so was Nuveen's stock and on Friday the Fed famously opened its discount window, thereby restoring confidence (at least temporarily) in the credit markets.

This Monday, Nuveen shares are once again changing hands north of $60 (though they have yet to retake the ground above $61).

At this point, there is no reason to doubt the deal. Madison Dearborn Partners' only reason to be in the media is its fight with Tornante Co. over the Topps card collection. There are no rumors about the deal possibly falling apart -- at least none that we have heard -- and, in all likelihood, the credit markets will be back to normal by the time the remainder of the Street is back from its Labor Day vacation. 

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