Simmons & Simmons has moved to distance itself from an embarrassing involvement with high-profile multimillionairess Madame Nahed Ojjeh, who was slammed by the Takeover Panel for her part in the hostile battle for Cordiant.
Paris-based Ojjeh, the wife of deceased billionaire arms dealer Akram Ojjeh, breached the Takeover Code for failing to disclose her dealings in Cordiant shares. While indirectly advised by Simmons she failed to make the proper disclosures over a series of share acquisitions in Cordiant. By 17 July she owned a strategically crucial 10.95 per cent stake.
During June, Ojjeh made an initial series of share-notified acquisitions in Cordiant, which has been subject to competing hostile takeover bids from WPP and Publicis since May. The Takeover Panel also assessed whether Publicis or shareholder group UK Active Value acted in concert with Ojjeh, but it is understood that this was not the case.
Ojjeh’s French law firm, corporate boutique Veil Jourde La Garanderie, brought in Simmons on 2 July. Simmons, one of the few City firms not already conflicted in the battle, was appointed to advise Veil Jourde, and indirectly Ojjeh, on UK securities law and regulation.
Between 3 July and 10 July, Ojjeh made more share purchases thr-ough intermediaries on 45 separate occasions, increasing her stake to 9.89 per cent, a clear breach of the Takeover Code. The Takeover Panel did not receive a retrospective notification until 11 July.
On 10 July, Simmons dropped Ojjeh. The embarrassing saga raises similar ethical questions to those faced by Weil Gotshal & Manges earlier this year, when the US firm advised Indigo and its managing partner Robert Bonnier on a series of share acquisitions in struggling property company Regus. In that case, the Takeover Panel eventually concluded that Bonnier had acted without first asking his lawyers, improving Weil Gotshal’s position. However, an out of control client is guaranteed to leave any law firm red-faced.
Veil Jourde, which has a longstanding relationship with Ojjeh, is also understood to have previously advised Publicis, the French advertising giant that tried to put Cordiant into administration in June.
Publicis, which is being advised by Clifford Chance insolvency partner Mark Hyde and corporate partner Daniel Kossoff, denies that it has had any contact with Ojjeh.
However, Publicis has confirmed that it has been approached by Cordiant’s largest shareholder Active Value, which is being advised by Stephenson Harwood partner Kevin Dean.
Active Value, a fund that specialises in investing in under-performing listed companies, also denies that it has had any contact with Ojjeh and her advisers.
The battle for Cordiant has been dogged by controversy for some of the law firms working on the deal. First, it emerged that Allen & Overy was advising WPP, which is in the throes of taking over Cordiant, as well as Cordiant’s banks (The Lawyer, 16 June). And later in the month, The Lawyer reported that Publicis ditched Herbert Smith in favour of Clifford Chance (23 June).
17 June Cordiant announces it is in exclusive and advance negotiations with WPP
19 June Cordiant board recommends WPP bid
27 June Ojjeh acquires 1.35 per cent stake in Cordiant
30 June Ojjeh’s cumulative stake in Cordiant reaches 2.34 per cent
1 July Ojjeh discloses to Takeover Panel 30 June dealing in Cordiant shares
2 July Simmons & Simmons instructed by Ojjeh’s French law firm Veil Jourde La Garanderie
5 July Ojjeh writes to Cordiant notifying it of her 10.75 per cent stake (although this figure was later disputed)
8 July Cordiant announces to the London Stock Exchange that it has received a letter dated 5 July from Ojjeh’s lawyers stating that she has built a 10.75 per cent stake in the company
10 July Simmons & Simmons dumps Veil Jourde and Ojjeh. UK Active Value, Cordiant’s largest shareholder, announces that it has not had any contact with Ojjeh
11 July Publicis announces that it has been approached by Active Value regarding Cordiant. Publicis rejects the proposals
14 July Publicis announces that it met with Active Value and its advisers on 12 July