Wellspring Accused Of Hiding Tax Breaks From Cleaver Merger

Law360, New York (August 16, 2012, 8:54 PM EDT) -- The representative for former shareholders of boiler manufacturer Cleaver-Brooks Inc. on Thursday sued private equity firm Wellspring Capital Management LLC, the new owner of Cleaver-Brooks' parent, claiming $10 million in tax breaks stemming from the 2008 merger went undisclosed.

AC Holdings Inc. said in its complaint, filed in New York state court, that Wellspring’s wholly owned investment vehicle and co-defendant, Cleaver-Brooks Holdings Inc., breached a contract requiring it to hand over tax returns and notify the shareholders’ representative of any realized tax benefits that would have...
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