The Delaware Court of Chancery last week denied United Rentals’ request for summary judgment, meaning that a lawsuit filed by United Rentals seeking to force private equity firm Cerberus Capital Management to complete its $6.7 billion acquisition of the rental company will go to trial.
Chancellor William Chandler ruled “while the question is exceedingly close, summary judgment is not an effective vehicle for deciding the contract issues in dispute in this case.”
“The trial presents an important opportunity to establish that the merger agreement should be enforced as written,” United Rentals said in a statement.
Cerberus withdrew its $34.50-per-share takeover offer for United Rentals in November. Cerberus and United Rentals are disputing a clause in the merger agreement known as “specific performance.” United Rentals is claiming that the clause does not allow Cerberus to terminate the agreement and gives United Rentals the right to have the deal enforced. Cerberus contends its liability is limited to a $100 million buyout fee.
Based in Greenwich, Conn., United Rentals is No. 1 on the RER 100.