Guy Hands Claims EMI Deal Has Cost Him Billions
December 18, 2009 at 4:24 AM (PT)
BLOOMBERG NEWS reports there's a rift between EMI owner TERRA FIRMA Chief GUY HANDS, and his longtime money man at CITIGROUP. Writes BLOOMBERG, "It was around midnight and British financier GUY HANDS was on the phone again with 'the Worm,' his long-time dealmaker at CITIGROUP INC., DAVID WORMSLEY. The next morning, MAY 21, 2007, HANDS’s private equity firm, TERRA FIRMA CAPITAL PARTNERS LTD., bid 4 billion pounds ($6.5 billion) for EMI GROUP PLC, the LONDON-based record producer whose pedigree runs from the BEATLES to BEYONCE. EMI’s managers, advised by WORMSLEY, accepted the offer the same day.
Two years later, the purchase has turned sour and personal for both men, with HANDS saying in a lawsuit against CITIGROUP that WORMSLEY 'misrepresented' the facts to rush him into a deal that cost his firm 'billions' of dollars."
The lawsuit filed this week by the ABU DHABI INVESTMENT AUTHORITY against CITIGROUP are signs that investors who made big bets during the boom are turning to the courts to recoup losses.
"There will be more similar lawsuits" to HANDS’s, British venture capitalist JON MOULTON, who’s known WORMSLEY and HANDS for years, said in a telephone interview with BLOOMBERG NEWS. "Back then money was deployed on very flimsy information. There were very clear conflicts of interest. People were just anxious to be in the deals."