Just hours after reports surfaced that mega-buyout firm Cerberus Capital Management had been in negotiations to acquire security contractor Blackwater, a Cerberus spokesman has declared the talks are dead.
The New York-based turnaround firm, whose reputation for secrecy and reclusiveness has made it a favorite target for critics of private equity, had been eyeing the controversial private military company despite a myriad of investigations and lawsuits into Blackwater’s activities in Iraq, according to a report by ABC News.
Those investigations include allegations of tax fraud, improper use of force, arms trafficking and overbilling by Blackwater in relation to several US government contracts to protect US civil servants.
Cerberus has made several personnel moves in recent years to improve its public image, including tapping former US Treasury Secretary John Snow as a partner. Despite its clandestine reputation, the Steve Feinberg-led unit has completed some of the highest-profile deals in private equity, including the 2007 take-private of US automobile maker Chrysler for $7.4 billion.
Cerberus could not be reached for comment.