Cerberus Capital Management and Chatham Lodging Trust (CLDT) yesterday terminated their $1.1 billion agreement to buy 64 hotels owned by bankrupt Innkeepers USA Trust. Seems the firms believed that a material adverse change (MAC) clause had been tripped.
It’s been a while since we’ve been a large leveraged buyout collapse but this is hardly the first (or most prominent) time. Here are the five-largest North American LBOs to collapse since 2007, courtesy of Thomson Reuters:
1. Bell Canada (2007): $46 billion by Ontario Teachers Pension Plan, Madison Dearborn and Providence Equity Partners.
2. Sallie Mae (2008): $25 billion by J.C. Flowers, Friedman Fleischer & Lowe, BoA and J.P. Morgan.
3. Penn National Gaming (2008): $8.7 billion by Fortress Investment Group and Centerbridge Partners
4. Harman International (2007): $8.1 billion by KKR and GS Capital Partners
5. Alliance Data Systems (2007): $7.7 billion by The Blackstone Group