Cerberus Capital Management LP

Cerberus Capital Management | Private Equity Notes

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Resource #1: Cerberus Capital Management's website

Resource #2: Focus DIY, Cerberus Portfolio Company Avoids Going Under

Focus DIY, a UK company owned by private equity firm Cerberus Capital Management, has avoided insolvency after its landlords agreed to cut its outstanding fees on properties it rents for business.

Plans to save Focus won between 93 and 100 per cent of votes from landlords. Without 75 per cent of votes, Focus would have gone under. The company will now pay its creditors a proportion of what it owes them.

The agreement will see leases for empty stores bought off with two lump sums equivalent to six months’ rent. The DIY chain has 180 stores still trading with the 38 closed outlets costing £12m (€13.7m) a year in rent. While the payout is less than the lease values, it is more than landlords would receive if the firm went under. Source

Resource #3: (8.9.2009) FOR Steve Feinberg, the onetime owner of Chrysler , the past year has been a crawl toward defeat. He lost billions of dollars. He lost prestige. He lost his privacy. And he ended up a ward and supplicant of the federal government.

But, even now, Mr. Feinberg, a man who can play a decent game of chess while blindfolded, is hard-pressed to pinpoint many mistakes. Sitting in his office on Park Avenue, far away from the detritus that surrounds Detroit, he grows pensive when asked what he has learned from his audacious — and failed — effort to privatize and resurrect the legendary and deeply troubled auto giant. “I don’t know what we could have done differently,” he says, crossing his arms on his chest. “From the day we bought it, we worked hard to improve it.” (Read more...)

Resource #4: (7.20.2009) Robert Nardelli Joins Cerberus Capital Management

Robert Nardelli, the executive infamous for 'earning' a $210 million "golden parachute" upon leaving Home Depot, has landed a position with Cerberus Capital. He became familiar with Cerberus while he oversaw the private equity firm's portfolio company, Chrysler. It may surprise people that Cerberus selected Nardelli as CEO of Cerberus Operating and Advisory Company. This is a reasonable reaction considering Nardelli's recent track record.

Mr. Nardelli was hired as chief executive officer of Home Depot in 2000 after an unsuccessful bid to succeed Jack Welch at GE. Before Nardelli, Home Depot was headed former by Bernie Marcus, who had a easy-going saleman style which conflicted with his successor's disciplined management style. Besides Robert Nardelli's difficult manner, Home Depot faced the growing threat from home improvement competitor, Lowe's.
Read more...

Resource #5: (4.30.2009) Public Statement by Cerberus:

"Cerberus has worked diligently with the U.S. Department of Treasury, Mr.
Bloom, Mr. Rattner and the other members of the President's Auto Task Force,
Fiat, the UAW, the Lenders and all major constituencies to facilitate the
restructuring of Chrysler, LLC.  We appreciate the support for Chrysler LLC
reflected in the tireless work of its management team led by Bob Nardelli, Tom
LaSorda and Jim Press, and the efforts of The Treasury, the Auto Task Force
and all stakeholders to preserve and enhance the viability of Chrysler LLC.
We are optimistic that Chrysler's Chapter 11 case will lead to the expeditious
and efficient completion of the restructuring that has been agreed upon by the
major stakeholders, and we will continue to do all that we can do to support a
successful outcome." Source

Resource #6: (3.31.2009) It looks as if the three-headed dog has a lot less to look after. Cerberus Capital Management is expected to be an early casualty of the Treasury's rescue of the hobbled automaker, as the buyout firm will lose its 80 percent equity stake in Chrysler, The Wall Street Journal reported, citing people familiar with the matter.

According to the article, which cites an unnamed Obama administration official, Cerberus' equity stake in Chrysler is now worthless, effectively ending its ownership of the car company.

Cerberus will continue to hold a controlling stake in Chrysler Financial, and still owns a significant portion of Chrysler's secured debt, though much of that will likely be restructured as part of the government bailout. Read more...

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