Private equity used the same play against Red Lobster. Sell off all the land (to their other company), charge enough rent to possibly bankrupt the initial company, and either they find a way to pay it (usually enshittification) or they don’t. Either way, money is extracted and others are left holding the literal bills.
And the responsibility - its going to stain the resumes of the higher management of the victim company that they had a good company and it deteriorated under their management.
Fuck, seems like the only way to guard against these takeover-enshittify attacks is to never go public or take anybody elses money - and in that case they’ll just fuck your competitor, use them to undercut you and take your clients and run you out of business, and then run THEM to the ground.
The company I got laid off from was owned by private equity. They insisted we spend a shitton (as in, a literal multimullion dollar contract) with another company they own that does data processing, but the best part is absolutely nobody seemed to know exactly what data they were supposed to be finding what information in so it was just call after call of people kicking it around management failing to give actual direction for the project
In case people don’t know, Cerberus is very politically connected to the Republican party. Dan Quale is high up in it and Trump is planning to appoint the CEO to Deputy Secretary of the DoD.
That makes no sense. How can an entity own the hospital, sell the land and then charge the hospital it owns rent?
Here’s what really happened. https://www.axios.com/2024/03/06/hospital-debacle-private-equity-cerberus-steward
Still shit? Abso-fucking-lutely! But it’s actually real and makes sense.
But that says the same thing, just in more detail.
In 2016 it signed a $1.25 billion sale-leaseback agreement for its Mass. properties with a publicly traded firm called Medical Properties Trust.
For example, it’s stopped paying vendors and owes at least $50 million in back-rent to MPT.
No it’s different. The sold them, agreed to lease them back, failed to pay the lease and then left someone else holding the bag.
I think you’re getting hung up on a small detail. Yeah, the original post does imply it’s Cerberus charging rent, but nuances like this are hard to convey in the format and I don’t think it matters to the overall point. Cerberus still sold the real estate, made huge amount of money and left the physicians to foot the bill (never mind making the physicians take out a huge load to buy back control).
Looks like more Luigis are needed.
They are killing us for profits.