BusinessCorporate FinanceChantrey Vellacott court threat

Chantrey Vellacott court threat

Chantrey Vellacott faces a court case over claims that its alleged negligence lost telecoms client Convergence Group a $100m (£52m) contract, a claim it denies

Convergence claims it lost an opportunity to pursue a telecoms project known
as ‘Silk Route’ based in Greece and the Mediterranean valued at more than $100m.
Convergence also claims that it had wasted expenditure of £15m.

The firm was approached by Convergence in 1996 for corporate restructuring
advice to raise finance to undertake the Silk Route Project.

The company says the advice was given without proper consideration of the
appropriate jurisdiction for the incorporation of an intermediate holding
company.

It also alleges that Chantrey Vellacott’s negligence had the result of making
February 2000 the earliest point at which Convergence could list, which it
decided not to undertake due to a downturn in the telecoms market.

It is claiming damages on the basis that the Silk Route Project will never go
ahead.

Chantrey Vellacott regards the case as without merit and wholly
unsustainable, court papers said.

It asserts that it had nothing to do with any alleged negligence, by citing
that Convergence had failed to appoint a financial adviser by March 1998 and had
no prospectus or software in place for any internet placing by that date.

It also said that the technology it was proposing to use was not available or
feasible and that Convergence did not have the necessary licences to carry out
the project.

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