Is this the beginning of the end for Cerberus? It's hardly a surprise that limited partners are gravely concerned. The list of blown-up portfolio investments does not stop with Chrysler and GMAC. They are merely the best know fiascos. Other troubled companies include Mervyns department stores, Western Nonwoven and Aozora Bank. Obviously, it was the Chrysler deal that inflicted the most harm, from a PR point of view. 

It's unclear how the limited partners will respond to Cerberus's offer to place their funds (what's left anyway) into a special purpose vehicle that would seek to unwind the portfolio in an orderly fashion and make regular cash payments. This aims to appease those who wanted out. Will anyone opt to leave their money in the funds, even for a reduced fee? You have to wonder how the firm will be able to thrive long-term. It definitely appears to be tainted, of course it is not alone in its pain. 

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