LONDON--(BUSINESS WIRE)--A Russian businessman who co-founded PhosAgro is suing the deputy chairman of the London-listed chemicals giant for what he claims is his rightful share of the business, a stake worth £1 billion at today’s market value.
The case pits Alexander Gorbachev – himself a former senior executive at PhosAgro - against his former friend and business partner Andrei Guriev, now one of Russia’s highest-profile billionaire oligarchs.
Gorbachev, who chaired PhosAgro between 2000 and 2004, claims Guriev held his shares in trust for him. It is alleged that Guriev later reneged on this agreement and unlawfully took possession of Gorbachev’s 24.75% stake in PhosAgro.
In a ruling issued yesterday, His Honour Judge Pearce ruled that proceedings had been served on Guriev, paving the way for a full trial to be heard in the English High Court in 2020-21.
The lawsuit could also have far-reaching implications for the interests of shareholders in PhosAgro. The company, which floated in 2011, is listed on the Moscow Stock Exchange with a secondary listing in London. Guriev is still PhosAgro’s biggest shareholder (via family members and other entities) but other investors include leading western institutions and pension funds.
Headquartered in Moscow, the company is Europe’s largest supplier of phosphate-based fertilizers and a major exporter to the west. Guriev is currently PhosAgro’s deputy chairman, while his son Andrei Jnr is the company’s CEO.
Guriev was served with legal papers on Berkeley Street, Mayfair, in October 2018. In court in July 2019, his lawyers argued that the papers were not served properly, and that accordingly the action should not proceed in the UK. A video of the court papers being served in a busy London street – with men who appear to be Guriev’s bodyguards physically shielding him from the paperwork – was examined as part of the proceedings. Judge Pearce has now ruled that the proceedings were properly served, and that the case can proceed.
The judge noted that in various important respects the video contradicted the account of events that Guriev and his entourage had given in their initial witness statements – before they became aware the Berkeley Street incident had been filmed. This, the judge remarked, “undermined the strength of their evidence”.
Judge Pearce added: “Without having heard cross examination of these witnesses, I cannot safely conclude that all or any of them are lying, though I have a strong suspicion this is so”. He also remarked in his judgment that it “is at least arguable” that “Mr Guriev has not told the truth”.
Judge Pearce’s ruling and the video of the Berkeley Street incident can be viewed at www.alexander-gorbachev.info.
Gorbachev is represented by City of London law firm Fieldfisher, led by partners Francesca Titus and Andrew Lafferty, and Paul Lowenstein QC.