Barclays
Linklaters refused to represent Barclays in connection with a controversial $3bn loan from Qatar at the height of the 2008 financial crisis amid concerns over its legality, papers filed at the High Court have claimed.
The claim is made in a filing by PCP Capital Partners, a private equity vehicle that had been working with Sheikh Mansour, a member of the ruling family of Abu Dhabi. In September 2008 Barclays had been looking to raise in excess of 6.5bn in capital and was in discussions with both PCP and Qatar Holding, then Barclays' largest shareholder.
According to documents filed this month in the Commercial Court in London, on 12 November 2008, Barclays' then-solicitors at Linklaters told Latham & Watkins, which was acting for the State of Qatar on the proposed loan, that [so as to] seek to ensure that no financial assistance is being provided the purpose clause should make it clear that the facility is being used for investments other than in Barclays .
The filing states: The Qatar Facility Agreement did not include any such representation , and that on the same day or the next, Linklaters declined to continue to act for Barclays in respect of the loan .
It continues: It should be inferred that Linklaters resigned (at least in part) because it was concerned that the Qatar loan would be illegal, specifically that it would involve unlawful financial assistance by Barclays for the purchase of its own shares.
The claim cites an email dated 13 November 2008 between senior Barclays bankers Stephen Jones and Roger Jenkins, which says: They have resigned on our loan to [Qatar], ostensibly on conflict grounds. Clearly very concerned about being [sic] to control where cash ends up.
PCP is claiming hundreds of millions in damages from Barclays with regards to false representations about the terms of the investment, claiming that its reliance on Barclays' representations meant that it missed out on hundreds of millions in potential fees or profits.
Allen & Overy took the lead role for PCP on the 2008 negotiations over the Saudi investment, while Clifford Chance acted for Barclays.
PCP is now being advised by City law firm Fladgate on the dispute, with partner Bree Taylor in the lead role. Simmons & Simmons is acting for Barclays.
The latest developments come after this June it was revealed that Barclays and four of its former executives are facing fraud charges over the 2008 Qatari loan.
The Serious Fraud Office announced that the bank and the four individuals had been charged with conspiracy to commit fraud and the provision of unlawful financial assistance .