September 20, 2020

Millionaire moguls fight over $200 million-plus


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10580923By Matt Nippert From Stuff NZ

Tens of millions of dollars worth of English property, and more than $200 million stashed in a Jersey bank account, are being fought over in the clash between Kiwi moguls Sir Owen Glenn and Eric Watson, a court ruling has revealed.

A ruling released overnight from the British Virgin Islands, quashing Watson’s attempts to shut down Glenn’s attempts to liquidate the pair’s partnership, has shed light on the high-stakes underpinning the dispute.

Glenn yesterday welcomed the decision and told Fairfax NZ: “We’re celebrating. It’s important because, after a long, hard fight, it looks like justice is being served.”

The ruling said the pair struck a partnership in mid-2012 to invest together, mainly in European property, using the company Spartan Capital as a joint venture, but the relationship between Glenn and Watson soured earlier this year leading to court actions in the Caribbean and England.

To date the highest-profile fallout from the stoush has taken place in the High Court at Auckland over their shared ownership of the Warriors NRL team, whose value is dwarfed by the sums being contested abroad.

With QCs being employed by both parties across three countries, it is likely that legal bills for the dispute will run into the millions.

The ruling, from the Eastern Caribbean Supreme Court, said Glenn had poured $232m (£113m) into the joint venture, of which around half had been used for property investments in the UK.

The property investments, made through British Virgin Islands holding companies, had been largely profitable and led Spartan to have around $211m held in a Jersey bank account.

The ruling said the parties differed markedly in their explanation of why they were in dispute.

Watson claimed Glenn had “become disillusioned with its investment and simply wishes to get its money back”.

But Glenn said contributions to the partnership were one-sided.

The ruling said Glenn claimed Watson “wishes the company to engage in speculative adventure, which, if successful, would benefit [Watson] under the profit-sharing arrangements which have been agreed, but at risk to Glenn as the major funder”.

The judge said both parties wished to end their partnership “although each has a radically different view as to how this is to be achieved”.

Glenn filed proceedings in the British Virgin Islands seeking to liquidate Spartan Capital as “the company is irretrievably deadlocked so that its business can no longer be carried on”.

Watson, in turn, filed proceedings in the English courts against Glenn’s interests, claiming breaches of a shareholders agreement between the pair.

Watson had sought to dismiss Glenn’s liquidation proceedings, claiming the English courts were best-placed to resolve the dispute, but this was rejected by the British Virgin Islands judge who said Spartan Capital was a British Virgin Islands company and many of its assets were held by British Virgin Islands holding companies.

Glenn said the ruling, although an early skirmish in a likely long campaign, was significant.

IMAGE: Eric Watson and Owen Glenn Fairfax NZ BATTLE LINES: An early skirmish in a stoush between Eric Watson and Sir Owen Glenn has played out in the British Virgin Islands court

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