Two Consulting Firms Dispute They Advised on Lebara Buyout Deal

(Bloomberg) -- When SIM-card company Lebara Group BV pitched a 350 million-euro ($414 million) bond sale to investors last August, it named four firms acting as advisers on the deal. Two of those companies are now denying they played the roles attributed to them.

Solon Management Consulting and Arthur D. Little Inc. told Bloomberg News this week that they hadn’t advised Swiss private fund Palmarium on its takeover of Lebara last year, which was funded by the bond issue. Palmarium rebuffed both statements and said the roles outlined in the investor presentation were accurate.

The dispute is the latest in a string of challenges this year over public disclosures made by Lebara and its owners. Lebara’s holding company has missed two deadlines for publishing audited accounts and corrected preliminary figures that excluded unprofitable units, prompting questions from investors and pressure on its bonds. In April, accountancy firm Grant Thornton denied a statement that it had been hired to review the books of Lebara’s holding company.

Strategic Advice

“We fully stand by the contents of this presentation,” Palmarium spokesman Matt Pollard said in an emailed statement on Thursday. In the presentation, it listed Solon as providing a “commercial assessment” because it had previously advised Lebara, Pollard said. Arthur D. Little was named a “strategic advisor” because it gave discretionary advice on executive appointments and arranged a “framework agreement” for potential work, he said.

Karim Taga, who runs Arthur D. Little’s telecommunication and media advisory business, disputed the characterization. He said that while he’d spoken with Palmarium, any pitches for business “were not converted to assignments.”

“Being considered as a ‘strategic advisor’ is usually when you get paid,” Taga said. “No revenues were generated. We haven’t received any document whatsoever on Lebara.” Arthur D. Little is the world’s oldest management consultancy with offices in 27 countries.

Dan Lerner, a managing director at Solon, said that the company never provided an assessment of Lebara related to the takeover and bond sale. He declined to comment on whether the technology and media-focused consultancy had worked for Lebara previously.

“Palmarium AG has never been a client of Solon,” Lerner said. “Nor have we performed a commercial assessment in respect of Palmarium’s investment into Lebara.”

Working Closely

Pareto Securities AS, the Norwegian bank arranging the debt sale, also named the advisers as having “worked closely” on the deal in an August 21 research note to clients.

Two further consultants are named in the presentation, saying PwC was advising on due diligence and brand valuation and Deltadrei was involved in research and technical evaluation. PwC declined to comment, citing client confidentiality. Officials at Deltadrei didn’t return calls and emails seeking comment. Deltadrei is run partly by Palmarium principals Raphael Auerbach and Suzanei Archer and it shares business addresses with companies managed by the pair.

KPMG, which is currently auditing a full year report for the company, is cited as independent auditor in the presentation.

©2018 Bloomberg L.P.