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Lex Greensill, the Australian financier, is set to make his first public courtroom appearance since his eponymous lending company collapsed when he testifies in a high-stakes London court case brought by a Credit Suisse fund against SoftBank.
The fund claims SoftBank “coordinated” with Lex Greensill’s company at the expense of the bank’s investors, who lost $440mn through assets backed by Greensill Limited, a subsidiary of Greensill Capital that is in liquidation and is also a defendant.
Lex Greensill is due to appear as a witness in the civil trial, according to people familiar with the matter. The trial begins on Thursday at the High Court in London.
It is the latest set of legal proceedings involving the Australian, who forged close ties to politicians including the former UK prime minister David Cameron and prominent business figures such as SoftBank founder Masayoshi Son.
Greensill Capital, his supply chain finance group, acted as an intermediary between businesses and their suppliers and presented its role as helping to address the problem of slow invoice payments.
The collapse into administration of the main UK company in March 2021 triggered a sprawling political and financial scandal. Greensill Capital’s failure led to billions of dollars in losses for investors in its financial products, including the now-defunct Swiss bank Credit Suisse.
In the High Court case, the Credit Suisse fund investors claim they lost about $440mn on notes named Fairymead, which were supposed to be secured by Greensill Capital over debts of a US construction company, Katerra.
SoftBank’s Vision Funds were investors in both Katerra and Greensill Capital, the Credit Suisse fund investors contend in their particulars of claim.
Lawyers acting for the claimants argue that Greensill Capital entered into two agreements they have described as the “impugned transactions”.
The claimants maintain Greensill gave up its claims over Katerra’s debts in exchange for shares in the construction company. They say Greensill then transferred these shares to a SoftBank entity “for no identified consideration”.
Lawyers acting for the claimants argue that the effect of these agreements was to make Greensill’s security over the notes “valueless” and put its assets “beyond the reach” of its creditors.
The claimants also contend that the relationship between SoftBank and Greensill Group was “coordinated at the highest levels of the two organisations” — including between Son and Lex Greensill.
SoftBank denies the claims. In its defence filed with the court, SoftBank argues that the lawsuit is an “attempt to blame” it for losses suffered by investors following the collapse of Greensill, and an “effort to deflect responsibility for its own failings”.
Lawyers acting for the Japanese group said its Vision Fund II provided $440mn to Greensill on the understanding that the sums would be used to repurchase or repay the outstanding Fairymead notes.
Greensill “subsequently misused the funds for another purpose”, they said, which “does not make the SoftBank defendants liable”.
Greensill Limited also filed a defence and is contesting the claim.
Lex Greensill declined to comment.
https://www.ft.com/content/60c01c69-859c-402b-b8b5-d7f4dbb83636
