Latest news with #Greensill
AU Financial Review
a day ago
- Business
- AU Financial Review
Lex Greensill decries ‘code of silence' in $677m SoftBank lawsuit
Financier Lex Greensill said there was a 'code of silence' around a series of transactions with SoftBank to keep potential losses hidden, in his first public court appearance since the high-profile collapse of his firm. Greensill is giving evidence at a $US440 million ($677 million) London trial brought by Credit Suisse against SoftBank over a restructuring agreement involving his trade finance firm in 2020.
The Guardian
a day ago
- Business
- The Guardian
Lex Greensill says SoftBank managers ‘felt threatened' by his links to founder
The financier Lex Greensill has told a court that senior managers at SoftBank 'felt threatened' by his relationship with Masayoshi Son, the founder of the Japanese tech investor that pumped hundreds of millions of dollars in his specialist lender before its collapse. Greensill said he travelled to Tokyo 'often weekly' for in-person mentoring sessions with the billionaire founder, who he dined with and referred to by the Japanese honorific 'Son-san'. Greensill made the comments in his first public courtroom appearance since the devastating demise in 2021 of his company, which counted former prime minister David Cameron as an adviser. Greensill said there were 'people in the SoftBank organisation who felt threatened by the nature of the relationship', and sought to 'make things difficult' for him. The Australian, who appeared in court with a trimly cut beard and dark blue suit on Monday, said that included some senior SoftBank executives. The businessman is appearing for two days of a month-long trial at the high court in London, in which a former Credit Suisse fund is suing SoftBank for $440m (£325m) over a complex deal it allegedly coordinated with Greensill prior to its collapse. It is part of efforts by Swiss bank UBS to recoup money for former clients of its former rival Credit Suisse, which it acquired in an emergency rescue deal in 2023. The case centres on funds that Greensill lent to Katerra, a US construction group that SoftBank had also invested in. Credit Suisse is alleging that SoftBank coordinated a restructuring plan for Katerra with Greensill in late 2020, in a move that benefited SoftBank and left the Swiss lender's clients out of pocket. SoftBank has denied the claims. Its lawyers told the court that it was a 'classic example of claimants casting around for a party with deep pockets on whom they seek to pin blame for a loss caused by their own negligence and risk-taking. It should be dismissed.' UBS said in a statement: 'We will continue to pursue all paths to maximise financial recovery of the supply chain finance funds, acting in the interests of all our stakeholders.' Greensill's comments come four years after his eponymous supply chain lender collapsed and became engulfed in a string of financial and political scandals. The 48-year-old Australian melon farmer turned City banker founded the lender in 2011, offering companies advances on their invoices in exchange for a fee. He would go on to gain high level political connections, and hired some of the world's most powerful former politicians including Cameron and former Australian foreign minister Julie Bishop. But the company, which at one point hoped to launch a £22bn stock market flotation, collapsed in 2021, after insurers refused to renew contracts that underpinned billions of pounds worth of loans and kept Greensill's complex financial operation afloat. It came amid growing concerns over the firm's management and billions of pounds of risky loans issued to companies owned by the metals magnate Sanjeev Gupta. Attention then turned to its government connections, including Cameron's efforts to persuade ministers to give Greensill access to government-backed Covid loans, resulting in a lobbying scandal that engulfed Whitehall for months. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion Greensill's failure had far-reaching financial consequences including for Credit Suisse, which packaged up Greensill's loans into investment funds for wealthy clients. Credit Suisse was forced to suspend $10bn worth of those funds after Greensill Capital went under. It left customers nursing hundreds of millions of dollars worth of losses, and further eroded investor confidence in the 167-year-old bank, which collapsed two years later. Son, who Forbes estimates to be worth $29bn, built SoftBank into one of the world's most prominent investors, making bets on tech and online services including China's e-commerce site Alibaba, the TikTok parent ByteDance and the UK chip designer Arm. He used his investment gains to make a series of increasingly bold bets on tech companies, and obtained Saudi Arabia's backing for its tech-focused SoftBank Vision Funds. During the Covid pandemic tech boom the valuations of its companies soared, but after the bubble burst SoftBank went through a period of retrenchment, though Son has continued to forge ahead with investments. The trial, which began last Thursday, is due to continue until 4 July.
Mint
a day ago
- Business
- Mint
Financier Lex Greensill Decries ‘Code of Silence' Around SoftBank Deals
(Bloomberg) -- Financier Lex Greensill said there was a 'code of silence' around a series of transactions with SoftBank Group Corp. to keep potential losses hidden, in his first public court appearance since the high profile collapse of his firm. Greensill is giving evidence at a $440 million London trial brought by Credit Suisse against SoftBank over a restructuring agreement involving his trade finance firm in 2020. He said there was a risk that a financing arrangement for an increasingly troubled SoftBank-backed startup would trigger an 'immediate' claim worth hundreds of millions of dollars. 'There was a code of silence around this transaction,' Greensill said in court on Monday. 'This whole transaction was to enable SoftBank to structure it as a balance sheet transaction so that it wouldn't appear on the' profit and loss account. Greensill said he was ultimately forced to accept the SoftBank restructuring calling it 'painful.' The London lawsuit is focusing on how Greensill restructured its relationship with Katerra Inc., a US-based construction company in which SoftBank was a major investor. Credit Suisse alleges SoftBank concocted the restructuring in 2020 so that it could pull its own money out of the firm, knowing full well that Greensill, already in free-fall, would be unable to repay the $440 million it owed to Credit Suisse. SoftBank argues that the Credit Suisse case has always been an attempt to shift blame 'for its own poor investment decisions.' The allegations are 'entirely without merit,' it said previously. SoftBank's lawyers said that the $440 million was provided by the Vision Fund on the basis that it would be used to repay the Credit Suisse notes. In his evidence, Greensill talked about the rupturing of his relationship with SoftBank and its founder Masayoshi Son, who once mentored him. He said that some executives were 'threatened' by his close relationship with Son and that he would speak directly with the founder, bypassing executives including Rajeev Misra, in an attempt to speed financial support from SoftBank. 'There were certain people in the organization who felt threatened by the nature of the relationship Son-san had with me,' Greensill said, using the Japanese honorific. 'Some people liked to play games and make things difficult.' Credit Suisse previously disclosed emails in the trial from Misra, who was then sitting on the investment committee of SoftBank's Vision Fund, who'd warned in an email that Lex Greensill was often dishonest and 'slippery.' The two clashed over the levels of financial support that SoftBank would offer to Greensill through 2020, before Greensill Capital collapsed the following year. 'Mr. Son is SoftBank,' he said, describing him as 'someone who can look over the horizon in a way most ordinary mortals can't.' Greensill will be questioned by lawyers for both Credit Suisse and SoftBank over the next two days. In a filing, SoftBank's attorneys said that the financier had at times displayed 'hostility' to the Japanese group. 'He is in no sense the witness of the SoftBank group,' they said. UBS Group AG is pursuing the London claim on behalf of its former Swiss rival in a bid to recover funds for investors trapped in the supply chain finance vehicles. The fallout from Greensill spawned multiple legal fights around the world. Lex Greensill himself is fighting moves by the UK government to have him disqualified as a director, while his firm's own administrators filed a civil case against him in April. More stories like this are available on
Bloomberg
a day ago
- Business
- Bloomberg
Financier Lex Greensill Decries ‘Code of Silence' Around SoftBank Deals
Financier Lex Greensill said there was a 'code of silence' around a series of transactions with SoftBank Group Corp. to keep potential losses hidden, in his first public court appearance since the high profile collapse of his firm. Greensill is giving evidence at a $440 million London trial brought by Credit Suisse against SoftBank over a restructuring agreement involving his trade finance firm in 2020. He said there was a risk that a financing arrangement for an increasingly troubled SoftBank-backed startup would trigger an 'immediate' claim worth hundreds of millions of dollars.
Business Recorder
5 days ago
- Business
- Business Recorder
Credit Suisse, SoftBank fight over Greensill losses in $440mn London lawsuit
LONDON: Credit Suisse's $440 million London lawsuit against Japan's SoftBank Group Corp kicked off on Thursday over losses linked to Greensill Capital, with the collapsed finance firm's founder Lex Greensill expected to give evidence next week. The case, which centres on funds Greensill lent to Katerra, a SoftBank-backed U.S. construction group, is the latest concerning Greensill's demise, which caused heavy losses for investors and prompted lawsuits and regulatory probes. Greensill's collapse made Credit Suisse close $10 billion of funds linked to the financial firm and, along with other scandals, led to the 2023 state-backed rescue of the 167-year-old Swiss bank by rival UBS Group. UBS is now pursuing the case against SoftBank, with Lex Greensill and Eric Varvel, former chairman of Credit Suisse's investment bank, among the key witnesses at the trial. The lender alleges that Greensill, at SoftBank's behest, gave up rights to Katerra's debts in return for shares which it then passed on to a SoftBank Group entity, leaving Credit Suisse out of pocket in relation to $440 million of notes. UBS completes merger of Credit Suisse service units in India Lawyer Sonia Tolaney, representing the Credit Suisse fund that held the notes, said SoftBank was heavily exposed to both Greensill and Katerra, to a total of around $3.5 billion, and 'needed to protect the value of its investments'. SoftBank, however, says the lawsuit lacks merit and is simply an attempt by Credit Suisse to 'pin blame (on SoftBank) for a loss caused by their own negligence and risk-taking'. Tom Smith, a lawyer for SoftBank, said in court filings that SoftBank paid $440 million to Greensill 'on the agreement and understanding that this was to be used to repurchase or redeem' the notes and pay back Credit Suisse in full. 'Far from seeking to harm (Credit Suisse), the (SoftBank defendants) and (Lex Greensill) acted to protect (Credit Suisse) because of its importance to Greensill's business model,' he said.
