Financier Amanda Staveley’s private equity firm today told the High Court it had received a “substantially worse” deal than Qatar when its syndicate invested billions of pounds in Barclays during the financial crisis in 2008, as it launched a civil case against the bank.
PCP Capital Partners is claiming damages of up to £1.5bn for alleged deceit. At the opening hearing of the trial, which is taking place online, a lawyer for Staveley’s PCP Capital Partners alleged Barclays had reneged on written and oral representations that PCP’s syndicate would get the same terms as Qatar.
The case hinges on the terms Barclays offered Qatar and PCP’s syndicate, which included Abu Dhabi investors, for taking part in a £7.3bn cash call in October 2008 that allowed the British bank to avoid a state bailout.
Barclays has dismissed the case as misconceived. “We believe the claim is misconceived and without merit and Barclays will be vigorously defending it,” a spokesperson said.
The bank argues that an eight-year Serious Fraud Office inquiry into whether side deals – known as advisory service agreements (ASAs) – struck with Qatar in 2008 had in fact been undisclosed fees had resulted in blanket acquittals.
PCP, whose syndicate invested about £3.25bn in Barclays in 2008, was paid £30m in April 2009 for its work on the deal.
PCP is alleging that Barclays paid Qatar £346m pounds in extra fees as well as agreeing to a $3bn (£2.4bn) for the Gulf nation in November 2008 that at the date of drawdown almost exactly matched the amount Qatar was investing.
“In fact, the deal that the Qataris got was very substantially better and PCP’s deal very substantially worse,” lawyer Joe Smouha told the court as he opened the case for the private equity firm.
Qatar has said its investment in Barclays created a strategic partnership and was part of a plan to build a global financial portfolio and that the ASAs were genuine.
The high-profile trial, one of the last legal clashes in Britain to revolve around the 2008 financial crisis, is expected to hear nine weeks of evidence.
Staveley is due to give evidence later this week, and former Barclays chief executive John Varley and former senior banker Roger Jenkins are expected to be called to give evidence.
The PCP case comes to court four months after Jenkins and two other former Barclays executives were acquitted of fraud in the criminal case brought by the SFO over two 2008 fundraisings. Varley was acquitted last year.