All posts tagged Citigroup

Label's Fate in Jurors Hands?

[UPDATE: After just 4 1/2 hours of deliberation, the jury has ruled against Terra Firma in the case it brought against Citigroup, which could possibly force Hands to relinquish control of EMI to the bank...] Yesterday the jury in the trial between Terra Firma and Citigroup over the 2007 acquisition of EMI heard closing arguments from both sides. David Boies, attorney for Terra Firma, gave an impassioned speech to the eight remaining jurors, which lasted over two hours, essentially explaining that if it were true that Citi’s David Wormsley had not mislead Guy Hands into thinking there was a rival bid for the storied music company, then he of course wouldn’t have gone through with the auction purchase, saying “If they hadn’t believed Cerberus was bidding, if they didn’t believe there was an active auction, why would they have gone ahead and submitted a bid?”. Citi attorney Ted Wells gave a very matter-of-fact argument that his client never mislead Hands, and there was no concrete evidence provided during the trial to prove otherwise. The basis of his closing argument being that Hands was brash in thinking that he could turn “tin into gold” and that he only brought the case about because he was upset over his poor investment, saying of Hands, his “magic sauce didn’t work this time.”

The Worm Testifies

Yesterday saw the end of Guy Hands testimony in New York City. Facing repeated questions about the lack of evidence proving his alleged phone conversations with Citigroup‘s David Wormsley took place, Hands stated that he “never kept notes. Even at university,” due to illegible handwriting from dyslexic and dyspraxic conditions… Wormsley also took the stand for the first time yesterday, though for only a short time, less than 30 minutes, primarily trying to establish his trustworthy standing with Hands and his firm, telling Terra Firma lead attorney David Boies “I would always be as truthful and honest as I could be.” Boies also provided a number of email exchanges that show Wormsley’s early focus on wooing Hands and Terra Firma, presumably in an effort to start the process of leading jurors on a path that ends with The Worm‘s lack of integrity as a trusted advisor to Hands being exposed. One such exchange had Wormsley writing in an email to another (now former) Citi executive, For reasons I won’t go into, we have to show big love to Terra Firma. To that end, it would be very helpful if you had an hour in London next week to sit down and meet with the Terra Firma team and hear their story... Today Wormsley’s testimony continued, with more phone calls and emails being brought to light – one of which was a call to Wormsley from a member of the EMI deal team relaying a conversation with Hands in which he disclosed Wormsley had tipped him that a bidding price for the music company at 2.4 pounds per share would be approved. Wormsley said he was “furious” about the call, and wanted Hands to send a “written confirmation” to the EMI team declaring that conversation had not happened – this came after testifying earlier that Hands had a reputation for making “low-ball offers.”  Also during his time on the stand today, he stated that Citigroup did not act as an advisor to Terra Firma on the deal, and that a majority of his correspondence with Hands dealt with financing aspects.  In another email that was revealed, sent to EMI’s Eric Nicoli hours before the bidding deadline,  Wormsley indicated that he had told Hands not to “play games on price.”