Credit Suisse plans £350m legal clash over Greensill downfall

Credit Suisse is preparing a £350m claim against SoftBank in what will be the first major UK legal dispute sparked by the fall of Greensill Capital

Credit Suisse is preparing a £350m claim against SoftBank in what will be the first major legal dispute in the UK triggered by the fall of Greensill Capital.

The financial titans are set to face off in a massive battle in the High Court after advisers from both sides failed to reach an agreement.

The action concerns US construction company Katerra, which had links to Greensill and collapsed last year.

Blowdown: Court documents show Credit Suisse claims it lost hundreds of millions of pounds after Katerra collapsed in June 2021 with over $1bn in liabilities

SoftBank was a major investor in Katerra through its Vision Fund.

Court documents, seen by The Mail on Sunday, show Credit Suisse claims it lost hundreds of millions of pounds after Katerra went bankrupt in June 2021 with more than $1 billion in liabilities.

SoftBank denied Credit Suisse’s claims.

Greensill, advised by former Prime Minister David Cameron and led by Australian financier Lex Greensill, built its lending business on ‘supply chain finance’ before imploding last year after its finances collapsed. started to deteriorate. Under its controversial model, Greensill bundled together various supply chain loans and sold them to funds managed by Credit Suisse.

Greensill went bankrupt in March 2021 after the Swiss bank decided to freeze its billions of pounds in funds with the company. Its collapse sent shockwaves through customers around the world, including tycoon Sanjeev Gupta’s Liberty Steel.

At the time of its collapse, Katerra blamed its “unexpected insolvency” on former lender Greensill.

SoftBank Group and its Vision Fund are each supposed to retain separate city attorneys.

Switzerland’s second-largest bank has already filed a request in the United States, demanding that SoftBank hand over information that could be used in “planned legal proceedings in England.” The case is part of Credit Suisse’s attempt to recover some of the $10 billion in funds linked to the insolvent Greensill.

SoftBank suffered losses in Greensill after pumping more than $400 million into the company just months before its collapse. It is understood that pre-action letters have been exchanged between Credit Suisse and SoftBank lawyers in the UK. The complaint to the High Court could be lodged within a few months.

It is understood Credit Suisse first threatened Softbank with legal action earlier this year.

The legal advisors of Freshfields Bruckhaus Deringer act for Credit Suisse.

Credit Suisse and SoftBank have both been contacted for comment.

Meanwhile, Liberty Steel has been trying to find new lenders since the Greensill debacle. Last month, its offices were visited as part of a Serious Fraud Office investigation and the audits of four of its subsidiaries are under investigation by the Financial Reporting Council.

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