A controversial legal battle between former and current executives of private equity firm Charterhouse Capital Partners is shedding light on how private equity regard pioneer partners and founders upon retirement. The Wall Street Journal said in its report that the public has been given insight to the 80 year-old firm, which is run by a tight group of long-time executives managing over €8 billion in assets.
Geoffrey Arbuthnott, a former Charterhouse partner, is accusing Executive Chairman Gordon Bonnyman and 15 other people, made up of former and current executives of the firm, for cheating the former out of his stake in the legendary low-profile firm, the WSJ reported. Arbuthnott claimed that Bonnyman and his lot had forced him to sell his equity interest in the firm in November 2011 for £1.35 million, which is less than its true value. Arbuthnott is seeking a judgement that will initiate an independent valuation of his shares with the private equity firm. On the other hand, Slaughter and May, legal rerpresentation for Bonnyman, contested London's Chancery Division of the High Court Arbuthnott 's allegations, claiming that the latter forced the company into acquiring his shares at a bloated price.
WSJ said the lawsuit centered on a lunch date that both parties have confirmed happened. Alleging malpractice in Charterhouse's buyout of PHS, a washroom service provider, Arbuthnott was claimed to have demanded the firm to buy all of his shares for £50 million and 9% of carried interest, or share of a fund's profits, in the firm's Fund IX. The firm added that Arbuthnott threatened them that he will be going to UK Financial Services Authority unless Charterhouse comply with his demands. Charterhouse also claimed that there was no malpractice with regard to the handling of its deal with PHS, WSJ said in its report.
