Egon von Greyerz / Media misrepresentation
Egon von Greyerz’s involvement in the corporate restructuring of Uno plc and its subsidiary World of Leather plc in the UK in 1999-2000
In November of 1999 Egon von Greyerz was asked to take over the chairmanship of Uno Plc (a publicly quoted furniture retailer) due to the ill health of the previous chairman and founder. The performance of the company had deteriorated and EvG’s role was that of a corporate doctor. Within 10 days of becoming chairman Egon von Greyerz discovered that the company was in serious financial trouble. During a four month period EvG, together with the board and other professional advisers, tried to rescue the company but sadly these attempts failed and the company went into Administration in March 2000. The board had taken independent advice during the four months period from top insolvency lawyers and accountants.
Two years later in 2002 the Department of Trade and Industry (DTI), due to political pressures, issued a press release criticising the directors for the company’s failure and indicating that the DTI intended to start a civil process against the directors that could lead to the directors being declared unfit to be directors of a UK company for a certain period. The DTI action was totally unexpected and the DTI had had no contact with the directors prior to their action.
The UK tabloid newspaper the Mirror picked up the tone of the DTI statement and used gutter press tactics to harass and attack the directors, declaring them guilty before the court case. This article appears high up on Google if a search is made on Egon von Greyerz.
What does not appear on Google is the fact that all the directors were totally exonerated in court. In his judgement of 30th April 2004 the judge (The Honourable Mr Justice Blackburne) totally rejected the DTI claim and praised the directors for their efforts to save the company. He also goes on to criticise the DTI for their behaviour in connection with issuing the claim and the press release.
These are some of the judge’s statements from the judgement:
“…….I am wholly unpersuaded that the charge of unfitness (of the directors) is made out”.
“Not only am I not persuaded that the defendants’ conduct during the four-month period is to be characterised as unfit but ignoring the benefit of hindsight, I see no real grounds for criticising them at all. From all that I have read and heard, the defendants went out of their way to pursue a solution which throughout the period had a reasonable prospect of succeeding and which, if achieved, would have satisfied all of the group’s creditors, including not least the cash-paying customers. Particularly is this so in the case of Mr von Greyerz who, under no obligation to do so, agreed to assume the executive chairmanship of the group in its hour of need and who, as my description of events has endeavoured to show was indefatigable in his pursuit of a corporate solution.”
“……… it would be an injustice to brand the defendants’ conduct over this period as meriting disqualification.”
The judge concludes his judgement with a severe criticism of DTI’s behaviour in this matter which he describes as “extraordinary”. His final sentence referring to the DTI states: “I express the hope that there will be no repetition in the future of (DTI’s) conduct of this kind.”
Unfortunately the press and Internet can sometimes be misleading and totally misrepresent a situation which happened in the case outlined above.