Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Chinese electric motor maker Harbin Electric (Nasdaq: HRBN) dropped as much as 12% in early Tuesday trading after investment firm Baring Private Equity Asia Group pulled back from its commitment to take the company private.

So what: Looking to become the first U.S.-traded Chinese stock to be taken private, Harbin had previously agreed to be bought by Baring at a price of $24 per share. However, the agreement was amended so that Baring's participation is now limited "solely of a right (but not an obligation)" to provide up to 10% of the financing for the deal.

Now what: With the help of Goldman Sachs (NYSE: GS), CEO Tianfu Yang intends to seek other sources of financing to pursue the $24 offer. But while it might be tempting to pounce on today's plunge and bet that the deal eventually gets done, I'd stay away. With its auditor Frazer Frost having recently been implicated in a fraud charges against RINO International (Nasdaq: RINO), there's just too much risk surrounding Harbin right now.

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