Billionaire Ron Burkle’s L.A. investment firm Yucaipa Cos. has acquired ownership stakes in two hospitality businesses.
The properties are the Delano South Beach hotel and Las Vegas nightclub operator the Light Group.
Both were previously owned by troubled boutique hotel operator Morgans Hotel Group Co. of New York, which has been under pressure from shareholders to return to profitability after years of losses. Morgans, which announced the deal Monday, also owns the Mondrian Hotel in West Hollywood.
Yucaipa financed the deal by canceling its stakes in Morgans senior convertible notes, preferred stock and stock warrants. Yucaipa also pledged to buy unsold shares of a forthcoming $100 million stock sale that will be offered to current Morgans shareholders.
Burkle’s other hospitality interests include a controlling stake in Soho House Group of London.
For reprint and licensing requests for this article, CLICK HERE.