But for many companies, the deteriorating credit conditions have closed the window on their ability to entertain any takeover at all. British software maker Civica, British cable operator Virgin Media, and Texas-based Nexstar Broadcasting Group, among others, have halted takeover talks or pulled themselves from the market.

At the same time, the credit crunch could doom some older targets now being digested by private equity firms, targets that may have stiff loan covenants or heavy variable-rate debt burdens.

"Probably not too many of these deals are going to implode in the next six to 12 months, but I think it is inevitable that some of them will have problems," says Edward Altman, director of the credit and debit markets research program at New York University's Stern School of Business. "In terms of those deals that are interest-rate sensitive or refinance sensitive, I think it will be sooner, rather than later."

It remains unclear whether the current crisis signals an end to the buyout boom, or whether even the shock of a highly-leveraged buyout defaulting could end the party.

 "So far, that shoe has not dropped," Blaydon notes. Both the Federal Reserve and the world's other central bankers have been increasing the money supply to keep it from doing so.

What is certain is that deals completed in the future will be different from some of the highly leveraged and pricey pursuits that led 2007. Buyers now will have to put more equity into deals or obtain lower purchase prices to get them done.

That means private equity groups will be pickier in choosing acquisitions, and, despite the recent swoon in the equity markets, stock prices may have to come down even further to garner much interest.

As George Roberts, the founder of Kohlberg Kravis Roberts & Co., told analysts on Wednesday, "Stock markets haven't fully reflected what's taken place in the credit markets."

None of this is inherently bad, says Jeanne Montague of Montague Partners, a San Francisco investment bank. It is likely to damp down the overheated prices being paid for some companies, she said.

Large corporate L.B.O.'s in the second quarter of 2007 had an average price of 10.6 times earnings before interest, taxes, depreciation, and amortization. Last year, the average was 8.5 times Ebitda.

"This is almost a 25 percent increase in the purchase price multiple, which is a dramatic change," she says. "I do not see any underlying factors in the health of either the U.S. or the global economy which can support those types of multiple increases in such a short period of time."

In the end, the credit lockup and the stock market swoon may be just what the doctor ordered to keep the L.B.O. deal alive for another day.