Mervyn's Creditors Land $166M Deal In PE Buyout Suit

Law360, Wilmington (October 9, 2012, 3:49 PM EDT) -- Creditors of Mervyn’s LLC scored a $166 million settlement in litigation over a 2004 leveraged buyout where several private equity firms allegedly leeched valuable real estate assets out of the department store chain, according to documents filed Friday in Delaware bankruptcy court.

In 2008, Mervyn’s unsecured creditors sued Sun Capital Partners Inc., Cerberus Capital Management LP, Lubert-Adler and Klaff Partners LP and others involved in the $1.26 billion acquisition of the chain from Target Corp., claiming the deal left Mervyn’s insolvent after the buyers stripped owned...
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