Just two days after the evidence began in what was expected to be a seven week trial, Terra Firma, the private equity firm headed by Guy Hands, has today confirmed in open court that it has consented to the dismissal of its £2.4 billion fraud claim against Citibank, that it unreservedly withdraws its allegations of fraud against the individuals concerned and Citibank and that it will pay Citibank’s costs.
The collapse of Terra Firma’s case followed just two days of cross-examination of Mr Hands. Mr Hands was expected to continue giving evidence for the whole of the following week.
Terra Firma’s claim arose out of its ill-fated acquisition of EMI in 2007. Terra Firma’s withdrawal of its case brings to a close more than six years of litigation in both New York and England in which Terra Firma had alleged that senior Citibank bankers had made fraudulent statements to Mr Hands in relation to the auction process and the provision of financing. Those allegations have now been withdrawn unreservedly. And in the immortal words of the Rolling Stones, one of the artists in the EMI fold acquired by Terra Firma: “it’s all over now”.
Mark Howard QC and Fred Hobson acted for Citibank, instructed by Clifford Chance.