THE QATARI royal family have signed a deal which could potentially see them own 50 per cent of three iconic London hotels, a court heard.
Details from the deal emerged in the action by developer and investor Paddy McKillen, who is suing British business twins Sir David and Frederick Barclay.
The Barclays and Mr McKillen own Coroin, which controls London’s Claridge’s, Berkeley and Connaught hotels. But Mr McKillen claims the Barclays unlawfully obtained their 64 per cent share in the company and acted in a way that is prejudicial to his interest.
Mr McKillen bought the three hotels in 2004 with Irish financier Derek Quinlan and other shareholders. He claims the investors drew up an agreement in 2004 that made it compulsory for a shareholder selling their stake to offer it to the existing investors first.
Mr McKillen claims Mr Quinlan and investment vehicle Misland breached the shareholders’ pre-emption agreement by selling their stakes to the Barclays without offering it to him first.
Lawyers for the Barclays said Mr McKillen could not raise the funds in February last year when the tranches of shares were sold to their client and could not raise it now.
But in court yesterday it emerged Mr McKillen has secured a “legal and binding” deal with Al Mirqab, an investment company controlled by the the Qatari emir, Hamad bin Khalifa Al-Thani, to fund the purchase of the 64 per cent stake from the Barclays. The Qataris would retain 50 per cent ownership in Coroin and the company would retain Mr McKillen as a project manager for development and to oversee the running of the hotels.
For his role, Mr McKillen would earn three per cent of redevelopment fund profits or roughly £4 million a year, the court heard. Mr McKillen told the court he would oversee the running of the three hotels and the redevelopment project planned for Claridges.
Kenneth MacLean, acting for companies including the Barclay brothers, said the document, which was disclosed to lawyers acting for them, was signed on March 12th. He asked if these were the same Qataris with whom Mr McKillen was unable to do a deal in February 2011 because he felt pressurised. Mr McKillen answered: “It has been at least a year since I have spoken to them. I felt pressurised then but things have changed now.”
Mr McKillen had asked for the details of deal to be secret for fear the Barclay brothers would “interfere with its operation”. But Justice David Richards said, since the deal was “legal and binding”, it was unlikely the brothers could interfere with its operation.
He said: “This agreement was put forward as a legal and binding document to provide funding for the purchase of the shares.
“This agreement states they would provide the funds should the company have success at trial or a settlement is reached outside court where the option is available. In such circumstances I think it would be unlikely the Barclay Brothers would be able to interfere with the operation of the agreement.”
Mr MacLean said the deal delivered what he had been chasing before the Barclays purchased the shares – a £5 million a year consultancy fee to project manage the hotels.
Mr McKillen said the fee “is a cost of running the hotel and if it was not done by me, we would need to employ someone else. It is a cost with which I will be employing a lot of people.”
The case continues.
