Former MWB Group chief executive Richard Balfour-Lynn, joint finance director Jagtar Singh and executive director Richard Aspland-Robinson have all been branded dishonest and deceitful by the Takeover Panel.
Balfour-Lynn denies being dishonest and told The Times: “If you park on a yellow line, you park on a yellow line. The motivation is irrelevant.”
The branding comes as a stock market scandal, kept under wraps for more than a decade, was laid bare by the panel.
A total of 11 people were named as being involved in a web of “sham transactions” and making “deliberately misleading statements in public documents as well as systematically lying to a regulator”.
The scandal centred around former listed company MWB Group, which owned the Liberty Store on Regent Street, W1, and the Hotel du Vin and Malmaison hotel chains.
The Takeover Panel claims that in 2009 and 2010 Balfour-Lynn, Singh, Aspland-Robinson and an uncle of Balfour-Lynn, Jeffery Eker, had acted in concert to buy shares in MWB to push their shareholding above the mandatory takeover trigger point of 29.9% and that the plan was kept secret, with no offer made.
In its statement, the Takeover Panel also alleges that through “sham sales” of two corporate vehicles, which had been incorporated to hold the shares, “members of the undisclosed concert party contrived to give the impression that they had divested themselves of whatever interests they had previously held in those shares”.
The executive of the Takeover Panel launched the investigation following a complaint by Hong Kong-based Pyrrho Investments, MWB’s biggest shareholder, with a 24.4% stake, in December 2011. Proceedings in the investigation did not begin until 2022.
The Takeover Panel has now ordered that no regulated firm in the UK should agree to act for the 10 listed directors. The bans, known as “cold shoulders”, range from one to five years.
It also found that Balfour-Lynn, Singh and Aspland-Robinson should be liable for £33m in compensation, plus interest, to outside shareholders of MWB.
Balfour-Lynn has not challenged the main findings of the investigation but was unsuccessful in his challenge to the compensation ruling. He has offered to pay £2m via an individual voluntary arrangement.
None of the parties have appealed against the “cold shoulders”, nor did Singh or Aspland-Robinson appeal the compensation ruling.
Other directors named in the Takeover Panel ruling include:
- Andrew Blurton, joint finance director at MWB
- Jean-Daniel Cohen, chairman of Hoche Partners
- Camillle Froidevaux, senior partner, Budin Associes
- Shaoul Houri, principal, EGT Finance
- Patrice Huguegin, lawyer, Budin Associes
- Keval Pankhania, finance director, Business Exchange
- Julian Treger, founding partner Audley Capital Advisors
Balfour-Lynn founded MWB in 1994 and built it into a major business. He resigned from the business in early 2012, the same year the business fell into receivership. It was liquidated in 2018.
Read the Takeover Panel statement in full >>
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