Billionaire Family Feud Revealed by Bugging at Ritz Hotel
(Bloomberg) -- A spat between the heirs of two of Britain’s most reclusive billionaires became very public this week following a court hearing that revealed that Frederick Barclay was being secretly recorded by his nephew at the Ritz Hotel.
The fight is taking place against the backdrop of changes within the business empire of once inseparable Frederick and his identical twin brother David. Public filings highlight how David’s sons have consolidated control of the five-star Ritz in Mayfair, while Frederick’s daughter Amanda has left the board.
The family tensions came to a light in a London court after Frederick discovered that his nephew Alistair Barclay had “engaged in covert audio surveillance” to record his conversations with Amanda in the conservatory of the hotel. The two had been talking about “potential acquisitions and disposals of business assets” as well as the structure and financing of the group.
“A dispute has arisen between different elements of the family over the governance and direction of the group businesses,” Judge Mark Warby said in his ruling, which was released Wednesday.
The 85-year-old twins are among Britain’s most discreet billionaires, known for a family compound on a tiny island off the U.K.’s southern coast. The two men have been considering offloading some of their most prominent holdings including the Brexit-supporting Telegraph newspaper and the Ritz.
Lawyers for Frederick and Amanda Barclay declined to comment. A spokesperson for the U.K. holding company declined to comment on behalf of the other members of the family, including Alistair.
At the heart of the litigation is Frederick’s concern that his conversations, which were transcribed and shared among family members, would be misused. In a legal filing for the court case, his lawyer said that he had sought a restriction preventing the defendants from using the information at all.
Corporate filings highlight the family’s divisions. Aidan and Howard Barclay replaced Amanda and one of Frederick’s staff as directors across six Ritz businesses, including the hotel’s main U.K. holding company. The latest filings came in the same week that the family tensions emerged.
Amanda, 41, has also stepped back during the same period from a company associated with Arlington Investors, the Jersey-based investment firm that has ploughed money over the past decade into the U.K. student-housing market. Frederick Barclay has previously advised the firm, and his daughter’s recent activity signals a partial withdrawal from the business sector.
The Ritz is the twins’ most valuable business, with the pair expected to recoup many times over the 75 million pounds ($97 million) they paid for the hotel in 1995. Their other holdings include delivery service Yodel and online retailer Shop Direct, which has needed funding from the Barclay family to cover claims tied to Britain’s insurance mis-selling scandal.
The Barclays paid 2.3 million pounds in 1993 for the English Channel island of Brecqhou. They erected a mock-Gothic castle, complete with almost 100 rooms, gilded turrets and a helipad.
The court proceedings add to the brother’s recent legal battles. In July, David lost a libel suit against a little-known French playwright who satirized the lives of him and his brother. David’s lawyer said at the time that he would probably appeal.
Three months later, Frederick was back in a divorce court with his estranged wife. A judge who oversaw the preliminary hearing placed limits on what can be reported, but the case may shed light on the Barclay family’s finances if it reaches a public decision.
David is the older sibling by 10 minutes. Born to Scottish parents, they spent their early days in a west London household so close to a railroad that trains would rattle the windows. After leaving school at 16, David and Frederick started their careers in the accounts department of General Electric Co., according to “The Twin Enigma,” a 2010 book by Vivienne Lewin. They teamed up in the 1960s to turn old boarding houses into hotels and moved into breweries and casinos, marking the beginning of their business empire.
©2020 Bloomberg L.P.