It sounds like most of the error was in the beginning. When given the opportunity to buy a business (especially when it is a good deal) people tend to be in a rush. The best way to evaluate a business' worth is with the ole' EBIT (or EBITD or EBITDA depending on the type of business). If he can not tell you: EARNINGS BEFORE INTEREST & TAX for that division of his company, I wouldnt get involved. At this point, I would definately get a lawyer involved and stonewall him with a letter stating that as business partners he should, in good faith, disclose all relevant financial information. If he doesn't, then threaten (and be prepared to follow though with) to litigate him for the money you invested.

My two cents.