United Rentals Inc.
(NYSE:URI) shareholders may be in for a ride after SuttonBrook Capital
Management disclosed a 5.83 percent stake in the company and announced
that they may hold discussions with management, other shareholders or
possible acquirers regarding a potential sale of the company. Many
shareholders are still looking for an exit after the company's failed
merger attempt with RAM Holdings (NDAQ:RAMR).
RAM Holdings and
RAM Acquisition, subsidiaries of private equity giant Cerberus Capital
Management, backed out of their planned $4 billion acquisition of
United Rentals in November. United Rentals subsequently filed a lawsuit
to force Cerberus to follow through with the buyout, since the firm
gave no justifiable cause for terminating the deal. Cerberus contends,
however, that they are only required to pay the $100 million breakup
fee without reason.
SuttonBrook announced today that it would be
in talks with interested parties regarding a possible merger,
reorganization or liquidation of the company, sale of assets, material
changes to the company's business structure, or changes in the board of
directors, among other considerations. Many shareholders are hoping
that other interested parties would be willing to make a bid or the
company at or above the price that Cerberus was prepared to pay.
In
the end, it is uncertain as to whether or not anything will become of
this, but there are certainly many wildcards in play. Combined, these
factors make URI a stock that is definitely
worth watching over the next few months!
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