Hands Gets Another Day In Court

Guy Hands has a second chance to show he should get more than £4 billion in damages because he was tricked into buying EMI.

The Federal Appeals Court in New York on May 31 ruled a retrial of the case that ended at the end of 2010 because the judge had given the jury the wrong directions.

Terra Firma, Hands’ private equity firm, had bought EMI for $6.6 billion in 2007.

Two years later, when Citigroup was about to foreclose on the money it had lent Terra Firma to complete the deal, Hands sued the bank with allegations that it had rigged the auction.

He claimed David Wormsley, a Citigroup banker working on the deal, fraudulently induced Terra Firma to overpay for the English music company.

He allegedly let slip that Terra Firma was bidding against another player who was prepared to go to 262 pence per share, when at the time all the other bidders had already dropped out.

The Manhattan District Court found in favour of Citigroup, which had denied the allegations and said Hands only brought the case when he realized he’d made a bad investment.