SPAIN - Al Numa Capital to sue Catalan government

Angelica
15 November 2007

Tweet
Facebook
LinkedIn
Google plus
Send to

After losing the mandate for the management of Mediterrània - a EUR 100m fund focused on investments in Spain and Maghreb - Al Numa Capital is to commence legal proceedings against the Catalan government.

Following months of wrangling with state-owned finance institution Institut Catala de Finances (ICF), the managers at Al Numa were told the mandate was to be transferred to investment bank Riva y Garcia. According to the managers at Al Numa, ICF also attempted to persuade the team to voluntarily renounce the mandate. It is understood that Al Numa’s EUR 200,000 bid bond has been retained by the institution, which is now refusing to pay it back.

ICF mentions loss of trust and changes in Al Numa's shareholding base as main reasons for the contract termination. In the GPs' opinion, the institution misused its power by ending the relationship for no objective reason, since the ability to manage the fund was never questioned. Additionally, the managers see the decision as a political manoeuvre to favour purely local players. Although Al Numa is based in Barcelona, its shareholding structure includes Capital Morocco, an affiliate of Morocco’s BMCE Bank and UK-based European Co-investment Partners LLP (formerly known as Glenalta Capital LLP).

"The only argument of ICF is that we did not honour the contract. This is simply wrong, because Al Numa Capital just enforced a clause in our tender submission that had been previously accepted," says Alex Sanchez-Mollinger, managing director at the Spanish firm. "It is fair to say that we were strictly compliant to the conditions set in paper and the same goes for the work we have done. Unfortunately, the same cannot be said of ICF, who has unlawfully broken a valid contract and is not acting in the public’s best interest by barring the best team from managing the Maghrebi fund," adds Sanchez-Mollinger.

It is understood that the GPs were already in advanced stages of due diligence with a Spanish and a Moroccan business. Although the future of Al Numa Capital is uncertain, the firm still has to decide what to do with the work that has already been done. The regulation process of the management company with CNMV has been temporarily discontinued.