Citi: Hands Reaching For Scapegoat
The case is playing out exactly as expected but there’s still no predicting the outcome, as leading Citibank lawyer Theodore Wells has tried to discredit the evidence given by Terra Firma chief Guy Hands.
He intends to show Hands is only in court because he made a bad call when he bought EMI and is now looking for a scapegoat.
On the third day of Hands’ mulitibillion-dollar suit against the bankers who lent him most of the £4.2 billion he spent on EMI in 2007, Wells suggested Hands only brought the case to protect his own interests.
“Isn’t it true you brought this lawsuit because you wanted to blame someone else for your purchase of EMI?” he asked, referring to a speech he gave to the music company in 2007. Hands told staff that 60 percent to 70 percent of his wealth was dependent on how well EMI performed.
Hands said that wasn’t the reason for bringing the action. Hands also denied he was motivated by fears that Terra Firma would receive lawsuits from its own investors over the money they’ve sunk into the ailing business.
Wells also suggested Hands is worried because he’s reached the point where he can no longer be confident of persuading Terra Firma’s investors to put in further millions to meet future bank covenants.
Hands hopes to prove he was duped into paying too much for EMI because Citigroup’s London-based dealmaker, David Wormsley, deliberately fed him false information.
Hands claims he spoke to Wormsley three times in the three days leading up to the bidding deadline for EMI, and he was told he needed to offer 265 pence per share or he’d lose out to Cerberus Capital. Cerberus had already dropped out of the auction and Hands was the only remaining bidder.
Wormsley denies it and says all three phone conversations with Hands were about entirely separate matters.