Now, Huntsman, 71, is battling someone not known for backing down. Last week, a showdown began in Delaware Court of Chancery between his chemical company and private-equity tycoon Leon Black's Apollo Management LP. Apollo wants to scuttle a July 2007 agreement to buy Huntsman for $6.5 billion, claiming Huntsman's operations have badly deteriorated. Huntsman says the business is solid and the merger pact is ironclad.

The trial has opened a window into the messy aftermath of the private-equity buyout boom, which came to a screeching halt last year when the credit crunch hit. Many deals struck at the end of that era have come unglued. Investors with cold feet are walking away from agreements. Companies they were supposed to buy are crying foul.

Hard-nosed foe: The Delaware lawsuit pits Huntsman against one of the buyout industry's most hard-nosed deal makers. Huntsman, who spent 38 years building his chemical company, characterizes the deal's collapse as a poor reflection on the business practices of the buyout industry in general, and of Apollo in particular.

''I will fight this until the day I die,'' he says, referring to Apollo's effort to kill the deal. ''Private-equity firms have taken over America, and we will fight it. These guys are getting away with dishonest behavior.''

He says that after the deal with Apollo was struck, he donated stock then valued at $700 million to a charitable foundation he set up to help fight cancer.

In testimony last week, Huntsman's son and company CEO, Peter Huntsman, said an Apollo official said as late as June 11 that the merger with Apollo subsidiary Hexion Specialty Chemicals Inc. was ''fine'' and didn't raise any questions about the combined company's solvency. Hexion sued to pull out of the deal a week later.

Apollo executives, including Black, declined to comment on the elder Huntsman's remarks or the lawsuit and trial testimony.

Apollo's deal for Huntsman came as the buyout boom was entering its final throes. It was structured as a merger between Huntsman and Hexion. The agreement called for Hexion to swallow a company twice its size, in a deal financed entirely with debt. Jon Huntsman estimates his family would have collected $1.3 billion for its 23 percent stake in the company.

Walking away from deals was once considered taboo in the buyout business, but the credit crunch changed that. Over the past year, many prominent private-equity players, including Kohlberg Kravis Roberts & Co., and Cerberus Capital Management LP have backed out of deals. Roughly 20 percent of leveraged buyouts of U.S. companies in 2007 have been terminated, according to FactSet MergerMetrics. In some cases, buyout firms have blamed faltering finances; in others, they accuse banks of reneging on their financing commitments. Some jilted companies say the explanation is simpler - buyers' remorse.

The battle between Apollo and Huntsman comes at a sensitive time for Apollo, which is preparing to take itself public and has struggled with several of its large investments. Huntsman also has sued Apollo in a Texas state court, alleging that Apollo fraudulently interfered with Huntsman's efforts to finalize a deal with another potential buyer.

Apollo's Black, 57, grew up in Manhattan, the son of a prominent executive. Friends say the suicide of his father when Black was in college contributed to his determination to succeed on Wall Street. He helped develop the junk-bond market with Michael Milken at Drexel Burnham Lambert.

When that firm collapsed in the late 1980s, he started an investment firm to buy troubled companies and distressed securities. Apollo now has $40 billion in assets under management and dozens of portfolio companies, and Black's estimated net worth is $4 billion.

Aggressive push: Earlier this decade, Apollo decided that the chemicals industry represented a good investment opportunity, and it began an aggressive push into the sector.

A buying spree at Huntsman had left the company, then privately held, with a heavy debt load. By 2002, it was in dire need of debt restructuring. Huntsman struck a deal with MatlinPatterson Global Advisers, another large private-equity firm, to convert its debt holdings into a 49 percent stake in Huntsman.

Later, Jon Huntsman decided he wanted to sell his company, in part to fund his philanthropic activities. In 2005, he sold shares in the public markets for the first time, a move designed to put a valuation on Huntsman in advance of a sale.

Apollo, which had formed Hexion that year by combining four chemical companies, was a logical buyer. An acquisition of Huntsman would enable Apollo to create one of the world's largest specialty chemical companies, with annual sales of $14 billion and 21,000 employees.

The two began talking in November 2005. By January 2006, Huntsman had agreed to accept a $25-a-share offer. But in the final hours of negotiation, Josh Harris, an Apollo co-founder, told Huntsman executives and lawyers that Apollo was lowering its offer to $24. Harris said the reduction was based on an earnings decline at Huntsman, according to people who heard the conversation. It was a maneuver sometimes referred to on Wall Street as a ''down bid.''

Jon Huntsman angrily rejected the offer. On Aug. 2, 2006, he met with Harris to reopen talks. Initially, Apollo said it could pay $25 a share, Huntsman says. But by the time the Huntsman board met eight days later, Apollo said it was willing to pay only $21 to $23. Again, Huntsman rejected the offer.

Eight months later, Apollo again offered $25, triggering a bidding war for Huntsman that included Basell AG, a Swiss chemicals company. Huntsman and Basell reached a preliminary agreement at $25.25 a share. Apollo counterbid, eventually reaching $28 a share. Jon Huntsman says his company and its board were duty-bound to accept the higher offer.

Several days after the deal was signed, Black and Harris flew to Utah to the Huntsman family's mansion in Deer Valley. Huntsman also invited his board and Utah Sens. Orrin Hatch and Bob Bennett. "I wanted them to look [the senators] in the eye and tell them it was a done deal.''

Huntsman says that Black assured the group he had a ''100 percent commitment to close the deal.'' As the two parties worked on the details of integration, though, Huntsman's financial performance began to weaken, causing its net income to sink 84 percent in the first quarter of this year.

Apollo's lawyers asked advisory firm Duff & Phelps to analyze the solvency of a merged company. Duff & Phelps concluded that even though both companies were profitable, if they merged they would be insolvent, thanks to the large debt they would take on. Apollo and Duff & Phelps didn't consult Huntsman managers before issuing the opinion June 17. Duff & Phelps declined to comment.

The next day, Apollo sued Huntsman in Delaware, contending that Hexion has no obligation to go through with the buyout because banks would not finance the deal. Merger agreements usually include ''material adverse effect'' clauses, which typically allow a buyer to walk away from a transaction if certain conditions change between a deal's announcement and its closing.

In the trial, Apollo must prove that Huntsman's deteriorating finances constitute a material adverse effect - that is, that there has been a substantial downturn unrelated to overall economic or industry weakness. This would allow it to walk away from the deal without paying a $325 million breakup fee to Huntsman.

The Delaware Court of Chancery has never found an MAE clause sufficient to excuse a buyer from going through with a merger. A ruling in Huntsman's favor won't necessarily result in a deal, and could be the beginning of a protracted legal fight.

Jon Huntsman says his firm's financial results have been improving. But last Monday, Hexion CEO Craig Morrison reiterated in testimony that the combined company would be insolvent.

Huntsman began presenting evidence to buttress its argument that the Duff & Phelps insolvency opinion is an Apollo concoction designed to scuttle the deal.

A Huntsman lawyer said that even if the combined company is insolvent, Hexion must use its ''best efforts'' to obtain alternative financing.

Last Thursday, Hexion officials said in a Securities and Exchange Commission filing that they won't oppose a move by members of the Huntsman family to provide more than $400 million in new financing to the merged companies.

The financing won't ''close the initial funding gap for the merger'' or significantly affect the solvency of a new company, they added, contending that financing has fallen short by about $858 million.