US: Andrew Zobler, founder and CEO of Sydell Group, has reportedly issued a lawsuit against Ennismore founder Sharan Pasricha for attempting to “sabotage” a rival hotel deal.
The lawsuit, filed in New York as reported by The Financial Times, relates to a 2018 incident involving Sydell Group and MGM Resorts International.
At the time, US billionaire Ron Burkle wanted to sell his 50 per cent stake in Sydell. Zobler entered into negotiations with Ennismore and MGM Resorts to potentially finance the buyout of Burkle’s stake.
Zobler made the decision to partner with MGM. According to the lawsuit, Pasricha “decided to sabotage the transaction rather than allow [Sydell] to obtain the benefit of financing the deal” and reacted in “an overly emotional and malicious” way.
Sydell alleged that Pasricha disregarded his obligations under a confidentiality agreement and approached Yucaipa – Burkle’s private equity firm – and revealed that Sydell was working to finance its purchase with MGM.
As a result, Yucaipa “exerted extraordinary pressure” on MGM – a company which Yucaipa already had a relationship with – to ignore the arbitration decision for MGM to pay a lower price, and instead pay the higher, proposed price of Burkle’s stake. The lawsuit said it deprived Sydell of a potential payout.
Sydell Group is seeking $30 million in damages from Ennismore. The lifestyle hospitality group’s co-CEO, Gaurav Bhushan is also named as a defendant in the case.
A spokesperson for Ennismore said: “Zobler’s claims are completely baseless and nothing more than a desperate attempt by a repeat litigator to misuse the judicial system to gain financially. We deny the matters raised and will defend vigorously against these meritless claims.”