Pentagon budget cuts have Cerberus Capital Management’s Stephen Feinberg wanting out of the military.
Cerberus, the private-equity powerhouse run by the 53-year-old investor, is “very close” to relinquishing control of its money-losing military logistics contractor, IAP Worldwide, to creditors, The Post has learned.
IAP, which runs military bases and transports goods, like water, to overseas posts, will change hands because it took on too much debt — and then could not make payments when Pentagon cuts robbed it of the chance to grow its balance sheet.
Investment manager Eaton Vance, Oppenheimer and Credit Suisse First Boston, IAP’s senior creditors, will take control, sources said.
The deal could be announced as early as Thursday, sources said.
More junior lenders — Monarch Alternative Capital and Levine Leichtman Capital Partners — may get smaller equity stakes.
The creditors believe the company may be able to win new business once they forgive much of their loans.
Cape Canaveral, Fla.-based IAP manages airfield operations, provides medical supplies and shelter, and runs dining-hall operations throughout the Middle East and Asia.
The company, as The Post previously reported, tripped a debt covenant on Jan. 1.
IAP isn’t Cerberus’ only big investment with a military attittude. Feinberg, a famously reclusive billionaire, also owns, through the PE firm, the gun maker Freedom Group, which made the rifles used in the Newtown, Conn., killings.
Cerberus has a long history with Washington. It owned Chrysler and GMAC, both of which were showered with government bailouts.
Cerberus and Eaton Vance declined to comment.