Hands: New York hearing will mean retention of tax status
TERRA FIRMA’S legal battle with Citigroup took a fresh twist over the weekend when boss Guy Hands claimed the case would have to be heard in New York as he cannot enter the UK for tax reasons.
The colourful entrepreneur is embroiled in a bitter dispute with Citi. He claims the bank misled him in the lead-up to his acquisition of ailing music giant EMI. He says Citi did not inform him the only rival bidder had dropped out and rushed him into a deal, going against due diligence laws. The bank denies the charges.
Citi is seeking to have the legal case held in London, instead of Hands’ preferred New York. But now the boss says his tax-exile status means he cannot enter the UK. The Guernsey-based businessman says he does not even visit his school-aged children or elderly parents in protest over high rates of tax.
Last week EMI’s misery was compounded when it announced annual losses of £1.56bn. Hands paid an astonishing £4.2bn for the company at the height of the buy-out boom. He borrowed £2.7bn from Citi. He has already written off 90 per cent of his investment. Terra Firma is now asking investors, including the New York Fire Department, to invest another £120m.