Now, Morgans is trying to undo its first bad deal with another complicated one, giving Yucaipa the D

The owner of the Delano South Beach, a boutique hotel in Miami, is fighting to get out of a bad deal it made during federal government joint travel regulations the height of the financial crisis so it can get significant amounts of new capital from lenders, according to the New York Times.
The Morgans Hotel Group, founded by developer Ian Schrager and Studio 54’s Steve Rubell, is spending tens of millions of dollars on lawyers and bankers to undo a transaction that landed it $72 million in late 2009 from investment firm the Yucaipa Companies.
Yucaipa gave the money through a private investment in public federal government joint travel regulations equity, or PIPE, in exchange for: as many as 12.5 million shares; the right to nominate a director; and veto power over a sale of the company or any of its assets as well as acquisitions worth more than $100 million.
federal government joint travel regulations Today, Yucaipa owns nearly federal government joint travel regulations 28 percent of Morgans, has bought $88 million of its debt and has its director, Michael J. Gross, in charge of the company. It also holds half of hundreds of millions of dollars of Morgans’ mortgage debt that is coming due in the next two years.
Now, Morgans is trying to undo its first bad deal with another complicated one, giving Yucaipa the Delano South Beach and its nightclub and food and beverage management business in exchange for cancellation of many options of the first deal.
The second transaction, though, is on hold after being successfully challenged in court by OTK Associates, an investment vehicle run by the Olshan and Taubman real estate families that owns 13.9 percent of Morgans.