KKR Pulls Business From Barclays After CEO Dispute, WSJ Says
KKR Pulls Business From Barclays After CEO Dispute, WSJ Says
(Bloomberg) -- KKR & Co. has pulled business from Barclays Plc because of a dispute with the bank’s chief executive officer over his response to a legal battle between the private-equity firm and his brother-in-law, the Wall Street Journal reported.
Jes Staley defended his wife’s brother, Jorge Nitzan, to other investors after KKR fired Nitzan as CEO of a Brazilian data-center company, Aceco TI, that it bought in 2014, the newspaper reported, citing people familiar with the matter that it didn’t name. KKR is involved in a legal battle with Nitzan over whether the firm can recover damages related to its purchase of a controlling stake, part of which it bought from Staley’s wife.
The newspaper didn’t say how much of KKR’s business Barclays has potentially missed out on. KKR has paid Barclays $190 million in investment-banking fees since 2010, the Journal said, citing Dealogic data.
KKR’s head of private-equity in the Americas, Alex Navab, had asked Staley to try to influence Nitzan, the Journal said. Instead, Staley encouraged another private-equity firm to invest in the struggling company and defended Nitzan in private conversations with two of KKR’s co-investors when asked about the situation, the newspaper said.
“Barclays has not been involved in the issues or transactions at the center of this commercial dispute,” Will Bowen, a spokesman for the London-based bank, said in an emailed statement. “However, appropriate senior personnel within Barclays have been kept informed about this matter, and in particular regarding any management interactions with the parties concerned.”
Bowen declined to comment on Staley’s behalf. KKR was also in legal arbitrations with Staley’s wife over recovering sale proceeds, Bloomberg reported last year.
"We have a responsibility to protect the interests of our investors who we believe were defrauded in the sale of Aceco,” KKR said in a statement. “We would also note that we have been a longtime client of Barclays, which comes with its own responsibilities for Barclays.”
The Aceco deal was KKR’s first in Brazil, and the firm described it as an “important milestone” at the time. The private-equity firm, led by billionaire founders Henry Kravis and George Roberts, has now written down its entire $475 million investment to zero, people with knowledge of the matter said last year.
--With assistance from Sarah Syed
To contact the reporter on this story: Stephen Morris in London at smorris39@bloomberg.net.
To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Jon Menon