LONDON - Financial disputes have come to the forefront as Walid Chammah, a former Morgan Stanley (NYSE:MS) banker, has taken legal action against René Benko's property conglomerate Signa. The lawsuit, filed in the High Court, pertains to unpaid fees exceeding €14 million for advisory services provided during the acquisition of Galeria Kaufhof. Chammah claims that despite fulfilling his consultancy role and guiding the significant transaction to completion in 2019, his success fee remains unsettled.
The legal battle emerges amidst Signa's financial troubles, which recently led to significant corporate restructuring. The company, once a sprawling real estate empire with interests in iconic properties like the Chrysler Building and KaDeWe, as well as a substantial stake in Selfridges valued at £4 billion, has faced a series of setbacks. In a move indicative of its distress, Signa conceded control of Selfridges to the Central Group last week.
Adding complexity to the scenario is the ousting of Benko from his management position earlier this month. Shareholders, including Hans Peter Haselsteiner, intervened with an emergency capital injection in an attempt to stabilize the faltering firm. This contrasts sharply with Benko's previous standing when Forbes estimated his personal fortune at around €6 billion.
Chammah's legal team asserts that Benko personally acknowledged the debt during conversations on March 30 and May 1, 2023. The dispute centers around an agreement reportedly made in a Mayfair private members club in 2015. According to Chammah, this agreement included a monthly retainer starting in 2016 and a success fee linked to the full acquisition of Galeria Kaufhof.
The case sheds light on the complex web of agreements and financial obligations that underpin major corporate transactions and the potential fallout when such commitments go unmet. With both parties entrenched in their positions, the High Court will now be tasked with unraveling the details of this high-stakes financial disagreement.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.