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Cerberus Capital Managements defends its decision

1 min reading time

Published on 07/10/11 - Updated on 17/03/22

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The Wall Street Journal cites "market turmoil" as the reason why Cerberus Capital Management LP refused a $1.12 billion deal from last August to purchase USA Trust hotels out of bankruptcy.

Cerberus states that a forecasted downturn in the economy is reason enough to refuse the deal, even though the event remains theoretical.The portfolio consists of 64 hotels.The WST states, "In a filing with the U.S. Bankruptcy Court in Manhattan on Monday, the private-equity firm said the deal's documents allow it and partner Chatham Lodging Trust to nix the transaction based on events that 'could reasonably be expected' to cause an adverse affect on the hotels, even if that event hasn't happened yet."The portfolio consists of 64 hotels.

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