Jefferies Sues Spanish Investor for $8 Million Unpaid Fees

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Investment bank Jefferies Group LLC sued a former client for about 7.2 million euros ($8 million) in unpaid fees linked to Vodafone Group Plc’s multi-billion-dollar takeover of Spanish cable operator Grupo Corporativo Ono SA.

Val Telecomunicaciones SL hired the bank in August 2013 to explore options for its 5.4 percent stake in Ono, according to documents filed by Jefferies in London and made available last week.

Madrid-based Val denies owing anything because it was obliged to sell its stake under “drag along” rules after a majority of Ono shareholders accepted Vodafone’s offer in March 2014.

“Jefferies appears to have done no or minimal work on the proposed sale” after Oct. 21, 2013 and wasn’t involved in the Vodafone transaction, Val said in documents in the case.

Vodafone, the world’s second-largest wireless carrier, agreed to buy Ono for 7.2 billion euros in March 2014, after convincing private equity shareholders including Providence Equity Partners, CCMP Capital Advisors LLC, Quadrangle Capital Partners and Thomas H. Lee Partners that it was a better deal than an initial public offering.

The suit comes as deals among global telecommunications companies are soaring. The number of transactions this quarter is 35 percent higher than in the same period last year, and has almost doubled in Europe, according to data compiled by Bloomberg.

1 Million Euros

Val spokeswoman Alex Moore Mayorga said the company has already paid about 1 million euros, its share of fees from the Vodafone deal, to Deutsche Bank AG, JPMorgan Chase & Co., UBS AG and Bank of America Corp., which advised Ono shareholders. Jefferies was unable to secure a sale of Val’s minority stake, she said in a statement.

Sara-Louise Boyes, a London-based spokeswoman for Jefferies, declined to comment.

Jefferies bankers including Michael Herbst identified more than 20 potential buyers of Val’s stake and gave a presentation to Vodafone in 2013, the bank said in its complaint.

The case is Jefferies International Ltd v. Val Telecomunicaciones SL, High Court of Justice, Queen’s Bench Division, Commercial Court, 15-358

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