United Rentals Inc. said Monday it will seek $100 million after a Delaware court ruled that private equity company Cerberus was not obligated to complete a $4 billion buyout of the equipment-rental company that it abandoned last month.
Greenwich-based-United Rentals asked the Delaware Court of Chancery last month to force Cerberus' acquisition vehicles, RAM Holdings Inc. and RAM Acquisition Corp., to complete the takeover. Cerberus Partners LP is the private equity owner of Chrysler LLC and General Motors Corp.'s financing' arm, GMAC LLC.
Court Chancellor William B. Chandler III ruled against United Rentals Friday, United Rentals and Cerberus said.
United Rentals, which rents equipment ranging from heavy machines to hand tools, said Monday it has decided not to appeal the ruling, but sent a request that Cerberus pay United Rentals a $100 million termination fee required by the merger agreement.
"In light of Chancellor Chandler's Dec. 21 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," the company said in a statement. "We remain committed to enhancing shareholder value, and believe the immediate need is to move forward and focus our energies on our business."
Telephone messages left Monday morning for a Cerberus spokesman were not immediately returned.