A pair of lawyers are among a group of 10 executives who have officially been given the “cold shoulder” by the UK’s Takeover Panel following a “uniquely complex and difficult investigation” on which a team from Gibson Dunn advised. 

Camille Froidevaux and Patrice Huguenin of Budin Associés have received the punishment – the harshest issued by the regulator – for their role in a series of transactions carried out more than a decade ago that enabled former executives of defunct property investment business MWB Group to mislead shareholders and the panel over the extent of their ownership of the company and failure to make an offer for it. 

Law firms advising on the case in various capacities alongside Gibson Dunn’s role as the panel’s lawyers included RPC, Taylor Wessing, Simmons & Simmons, Armstrong Teasdale and Fladgate.

At the time of the transactions, Froidevaux was senior partner of Budin, while Huguenin was described by the panel as a senior Swiss lawyer who had practised at the firm since 2003.

The cold shoulders are the result of an investigation by the panel that lasted more than a decade and that it described as “the most complex” in its 56-year history. It marks only the fifth time the regulator has issued such a sanction, which effectively bars UK financial companies from working with recipients on takeovers for a specified period. Only eight individuals have been given the cold shoulder in the past, the Financial Times reported. 

The investigation found that Richard Balfour-Lynn, the veteran hotelier behind Hotel du Vin and London’s Liberty department store who had been MWB Group’s chief executive, had acted in concert with MWB executives Jagtar Singh and Richard Aspland-Robinson to gain control of the group through a “series of sham transactions involving offshore entities” in 2009-10. 

The executives had already controlled nearly 30% of the company but eventually gained control of 50.33% of its issued share capital without disclosing that to the market, the panel said. That included a 15.2% stake that was presented as controlled by investor Julian Treger’s now-defunct Audley Capital in order “to mislead shareholders in MWB, other members of the board of MWB, the [panel] and the market generally” as to the shares’ true owners. 

The panel said this was in order to allow the executives to avoid their obligations under the Takeover Code, which would have required them to make a takeover offer to all the shareholders of MWB. Treger was among those to be cold shouldered, on the grounds that he had fronted the transactions and collaborated in allowing the use of the Audley name for the vehicles incorporated to hold the shares.  

Toppled by debt, MWB Group went into administration in 2012 and was dissolved six years later.

In a very rare move, the panel ordered the trio of MWB executives to pay compensation of up to £33m plus interest to affected shareholders. Balfour-Lynn appealed against the compensation order but was unsuccessful. 

According to the panel’s statement, Froidevaux and Huguenin made late admissions to the panel of their complicity, acknowledging during the hearing in November 2023 that they had knowingly been involved with the sham transactions and with Treger in covering up the executives’ ownership of the Audley companies. 

They also acknowledged that they had knowingly misled the panel in relation to those transactions and their involvement in them.

The panel ruled that Froidevaux and Huguenin should each be cold shouldered for three years on the grounds they breached its Code not to provide “incorrect, incomplete or misleading information”, and that its ruling should be brought to the attention of the Geneva Bar Commission. 

According to Budin’s website, both lawyers remain at the firm, which did not respond to a request for comment. Froidevaux declined to comment and Huguenin did not respond to a request for comment. 

The panel’s statement also accused each of the other eight cold-shouldered individuals of misleading it during its investigation. Balfour-Lynn and Singh were cold shouldered for five years each, and Aspland-Robinson and Treger for four years each. 

The Gibson Dunn team advising the panel was led by white-collar investigations partner Patrick Doris.

Meantime, an RPC team represented Pyrrho Investments, a BVI company which does business in Hong Kong as a family-owned investment fund and was MWB’s single largest shareholder in December 2011 when its complaint to the panel triggered the investigation. 

RPC’s legal team was led by partner and head of public companies, Connor Cahalane, with partner Simon Hart, head of banking and financial markets disputes, and of counsel Kirtan Prasad. 

“This is a historic enforcement ruling by the Takeover Panel, as it is the first time since the late 1980s that the panel has awarded compensation to shareholders affected by a breach of the Takeover Code,” Calahane said. “It reveals the lengths taken by Balfour-Lynn, Singh, Aspland-Robinson, Treger and others to conceal these sham transactions.”

Taylor Wessing represented Balfour-Lynn, according to the panel’s statement, while Simmons & Simmons acted for Treger. Armstrong Teasdale acted for Jean-Daniel Cohen, the chairman of Paris-based advisory Hoche Partners who the panel found was involved in facilitating the transactions. He was cold shouldered for two years. 

Shaoul Houri, whose family trust subscribed for 3,000 shares of a fund set up in the BVI by Budin to acquire the 15.2% stake in MWB, was represented by Fladgate. 

Keval Pankhania, the then-finance director of AIM-listed MWB subsidiary Business Exchange, was represented by boutique firm Drake & Case Law. He admitted to misleading the panel by minimising the extent of his relationships with Balfour-Lynn and Singh and his business dealings with them. Both he and Houri were cold shouldered for one year. 

The law firms representing the other cold-shouldered individuals, including Froidevaux, Huguenin, Aspland-Robinson and Singh, were not disclosed in the panel’s statement. 

Simmons & Simmons declined to comment. Taylor Wessing, Armstrong Teasdale, Fladgate and Drake & Case Law did not respond to requests for comment.