US investment company Oaktree has been ordered to pay Beijing investment manager Cindat Nephthys Holding £9.3m following their dispute over a deal in Canary Wharf.
Cindat and Oaktree (via Hunter Holdings Ltd) teamed up to buy 30 South Colonnade, known as the Reuters Building, from China’s HNA Group in 2019.
According to a ruling, which was handed down today, it was a complicated deal, partly because Cindat had an option to purchase the property, and did not want to redevelop it while Oaktree did.
Cindat, however, did want to retain an equity interest in the building.
According to the ruling, as part of the deal Oaktree agreed to a “put option” stating that, on the fourth anniversary of the completion of the deal, “Cindat shall have the right to require Oaktree to purchase all (and not part only) of the Relevant Securities free from all Encumbrances and all rights attaching thereto (the “put option”) by delivering notice in writing to Oaktree and the Company.”
Cindat did this. However, Oaktree refused to pay. They argued that the section should be rectified to say that the put option should only kick in “if (and only if) the company’s business plan is modified”.
Cindat took legal action and sought summary judgment.
In today’s ruling judge Mr Justice Picken backed Cindat. He said that, had there been an intention to change the wording, then it could have “easily” been done at the time.
He said that Oaktree should pay the option, which was calculated to be around £9.3m.
Cindat Nephthys Holding Ltd v Hunter Holdings Ltd
Commercial Court (Mr Justice Picken) 21 May 2024
Photo © Evgeny Klimenchenko/Unsplash
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