The largest shareholder of the Morgans Hotel Group, OTK Associates LLC, expressed its discontent with the Morgans Hotel Group decision to sell the Delano South Beach and the Light Group to Yucaipa Cos.
OTK Associates LLC is calling the Morgans board’s special committee into question over the recent transaction with Yucaipa Cos.OTK calls the deal “yet another ill-timed transaction,”, the reason being that two Morgans directors have special interest in the sale.The deal dilutes existing shareholders, rather favoring Yucaipa, and therefore dissuading further investment in the current management.OTK Associates is now evaluating legal options against the insider dealings. Morgans meanwhile denies allegations, noting that the deal was made through a special committee of disinterested parties.
