United Rentals terminates RAM merger deal
Tuesday, 25 December 2007
NEW YORK, Dec 24 (Reuters): Equipment rental group United Rentals Inc said Monday it terminated its US$4.0 billion takeover by Cerberus Capital Management and asked Cerberus to pay United Rentals a $100 million termination fee.
On December 21, a court denied United Rentals' ability to force Cerberus Capital Management to complete the takeover. United Rentals said Monday it will not be appealing the Delaware Chancery Court opinion.
In delivering the notice, United Rentals has requested that Cerberus Partners, L.P., pursuant to the guarantee given at the time of the merger agreement, pay United Rentals the $100 million termination fee required by the merger agreement.
Under the agreement, the fee is payable promptly and in any event within two days of termination.
A United Rentals spokesperson said: "In light of Chancellor Chandler's December 21st opinion, the United Rentals Board of Directors has determined that the Company is best served by terminating the merger agreement and the constraints it imposes. We remain committed to enhancing shareholder value, and believe the immediate need is to move forward and focus our energies on our business."
In light of the termination of the merger agreement, United Rentals also announced that it would not be appealing the Delaware Chancery Court opinion and is terminating the previously announced debt tender offers and consent solicitations (the "Offers") being made by its wholly-owned subsidiary, United Rentals (North America), Inc..
On December 21, a court denied United Rentals' ability to force Cerberus Capital Management to complete the takeover. United Rentals said Monday it will not be appealing the Delaware Chancery Court opinion.
In delivering the notice, United Rentals has requested that Cerberus Partners, L.P., pursuant to the guarantee given at the time of the merger agreement, pay United Rentals the $100 million termination fee required by the merger agreement.
Under the agreement, the fee is payable promptly and in any event within two days of termination.
A United Rentals spokesperson said: "In light of Chancellor Chandler's December 21st opinion, the United Rentals Board of Directors has determined that the Company is best served by terminating the merger agreement and the constraints it imposes. We remain committed to enhancing shareholder value, and believe the immediate need is to move forward and focus our energies on our business."
In light of the termination of the merger agreement, United Rentals also announced that it would not be appealing the Delaware Chancery Court opinion and is terminating the previously announced debt tender offers and consent solicitations (the "Offers") being made by its wholly-owned subsidiary, United Rentals (North America), Inc..