Web Page sponsored by Odyssey Corporate Finance
Contact: Tom McCarthy, Director, Odyssey Corporate Finance
M: 07867 459 600
D: 0121 503 2375
07 Feb 17. Cobham chiefs ‘stripped cash’ from failing firm: £2.3m share scandal rocks defence giant. Executives at Cobham stripped £2.34m from a subsidiary before it went bust, it is claimed. Christopher Jewell, finance director of the engineer’s aerospace and security division, and the firm’s senior vice-president Stephen Beeching are fighting allegations they knowingly took the cash from mobile-phone-tracking specialist MMI Research weeks before it was wound down. Papers filed with the High Court claim the pair who were made directors of MMI were responsible for moving £2.34m from the company to another part of Cobham.
Cobham is not being sued and declined to comment This left MMI unable to pay debts from a copyright case it lost or to stump up the cash for a huge bill following a tax-dodging investigation, it is claimed. As a result, MMI was wound down having failed to pay the money. Now litigation fund Manolete Partners is suing the two executives demanding £2.3m it believes company liquidators were deprived of. Both men are fighting the claim. Jewell, 52, worked at Cobham for nine years before leaving in December 2015, according to a Linkedin profile. Beeching, 47, joined in 2008 and remains a senior vice-president. He previously worked at tech firms Misys and Nortel, according to his Linkedin profile. Cobham is not being sued and declined to comment but the case comes at a turbulent time for the air-to-air refuelling specialist, which in January issued its fourth profit warning in less than 12 months. Litigation fund Manolete Partners is suing the two executives. Cobham bought Hampshire-based MMI in 2008 for £13.6m from entrepreneur Mark Slatter, hoping it would help it win work in the surveillance industry. At the time MMI was embroiled in a copyright battle with rival, Cellxion. Cobham later discussed combining MMI with another subsidiary as part of a streamlining process. With the court battle still raging, Cobham decided to sell MMI as a shell company back to Slatter so he could pursue the claim individually. When MMI lost the copyright case in January 2012 it faced a huge legal bill. It was at this point, court papers reveal, that Cobham decided to go ahead with the streamlining. Under a transfer arrangement a dividend of £2.29m was paid out of MMI to another Cobham subsidiary. Further funds were withdrawn in the form of an interest-free loan worth £50,000. The court papers claim Jewell and Beeching knew this ‘could have the effect of leaving MMI as an empty shell with no assets and unable to meet adverse costs’. (Source: Hawker Chase/Daily Mail)
10 Feb 17. Former Rolls-Royce CEO questioned in corruption probe. Serious Fraud Office interviews Sir John Rose and ‘dozens’ of others. Sir John Rose, the man who helped to build Rolls-Royce into the world’s second biggest aero-engine maker, has been questioned after being read his rights as part of the investigation into alleged corruption at the UK’s flagship engineering company.
Sir John is one of many former Rolls-Royce executives questioned “under caution” after the company last month reached a deal to pay £671m in fines to authorities in three countries, according to people familiar with the four-year probe by the Serious Fraud Office.
Questions “under caution” are with suspects who are read their rights and is distinct from interviews with witnesses.
As the focus shifts from corporate to individual responsibility, “dozens” of people, including both former Rolls-Royce top brass and middlemen the company deployed around the world, have been interviewed under caution by the SFO, those with knowledge of the investigation told the Financial Times.
Sir John denies any wrongdoing and has not been charged. Wilmer