Billionaire Auto Magnate Sues Daughter for $398 Million
(Bloomberg) -- Magna International Inc. founder and former Chief Executive Officer Frank Stronach is suing his daughter and others for C$520 million ($398 million), claiming mismanagement of the family fortune.
A lawsuit filed in Toronto by 86-year-old Stronach and his wife Elfriede names Belinda Stronach, chairman of the Stronach Group, Alon Ossip, Stronach Group’s CEO and others as defendants. Grandchildren Nicole Walker and Frank Walker and the Stronach Consulting Corp. are listed as co-defendants, according to the Toronto Star newspaper.
The Stronachs “regret having to commence proceedings in the Ontario Superior Court against their daughter Belinda, Alon Ossip and others,” the couple said in a statement issued by their law firms. “They only did so as a last resort, after having made considerable efforts over a period of almost two years to resolve the matters at issue on a consensual basis.”
According to the Toronto Star, the Stronachs are accusing their daughter and Ossip of “having undertaken a series of covert and unlawful actions” contrary to the best interests of other family members. Other accusations include allegations of breach of contract, fraudulent concealment and unjust enrichment, the Star said.
None of the allegations have been proven in court.
“Family relationships within a business can be challenging,” Belinda Stronach said in an emailed statement provided by a spokesman, Greg MacEachern. “My children and I love my father. However, his allegations are untrue and we will be responding formally to the statement of claim in the normal course of the court process.”
Paul Deegan, a spokesman for Ossip, called the allegations “baseless” and “not grounded in fact or reality. Alon has always honored his obligations and acted in good faith to preserve and grow the Stronach family’s assets and to protect the interests of all members of the family.”
Frank Stronach “was a great auto parts entrepreneur, but his recent excessive spending and numerous failed ventures put his family’s wealth at risk,” Deegan added. “This is a dispute between Stronach family members that should be resolved between family members.”
Frank Stronach and his wife married in 1964 and have two children: Andrew and Belinda. The latter, a former Magna CEO, runs a charitable foundation. She is a former member of Canada’s Parliament.
After a few years of working as a machinist in his native Austria, Frank Stronach arrived in Canada in the early 1950s with a few hundred dollars in his pocket and built Aurora, Ontario-based Magna into a company with revenue of $28.7 billion and net income of $1.1 billion by 2011 -- the year he stepped down as chairman. Magna, Canada’s biggest car-parts maker, had sales of about $40 billion in 2017.
Stronach is worth at least $1.9 billion, according to the Bloomberg Billionaires Index.
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