Omni Bridgeway to fund claims against UBS in connection with Folli Follie bond offering
This is a bondholder action for current and past Bondholders of the CHF 150 million 3.25% 2017-2021 bonds issued by FF Group Finance Luxembourg II SA and guaranteed by Folli Follie Commercial Manufacturing and Technical SA (ISIN CH0385518052) (the “Bondholder(s)” and the “Folli Follie Bonds” respectively), to be led by leading international law firm Quinn Emanuel Urquhart & Sullivan (Schweiz) GmbH (“QE”).
What affected bondholders can do:
Omni Bridgeway is currently inviting Bondholders who are not subscribed to the existing group action, to register their interest in the subsequent group action via the registration link.
In order for current and past Bondholders to be eligible to participate in the subsequent group action, they must have purchased the Folli-Follie Bonds prior to 2 May 2018.
Background
Following the October 2017 bond issue, hedge fund Quintessential Capital Management published a report in May 2018 summarising its findings concerning Folli Follie’s business. The report concluded Folli Follie had inflated financial and other business figures in its financial statements and other publications, overstating its points-of-sale network, revenues and cash reserves.
Although disputed by Folli Follie, global turnaround advisers, Alvarez & Marsal, reported in September 2018 that the discrepancies between Folli Follie’s 2017 figures and reality were massive and exceeded the worst expectations. The price of the bonds have fallen significantly and presently trades at approximately 8% of the issue price.
About the proposed action
Omni Bridgeway is an established, global litigation funder which already has a litigation funding arrangement in place with a group of Bondholders holding Folli Follie Bonds with a face value in excess of CHF 23 million for the purposes of bringing an action before the Swiss courts against UBS AG (the "Defendant") on the basis of their role as bookrunners for the offering of the Folli Follie Bonds. Quinn Emanuel Urquhart & Sullivan (Schweiz) GmbH has been engaged by the group to litigate the claims based on prospectus liability. The existing bondholder group has been coordinated by Alcimos Limited ("Alcimos"), a services company and Alcimos will perform a similar role with respect to the subsequent group action.
Interested present or past Bondholders will assign their claims to CH0385518052 - Bonds Claims Enforcement GmbH (the "SPV"), an entity which has been set-up to facilitate the efficient management of the litigation process. The SPV currently has three directors, two of which are Bondholders who have already subscribed to the existing group action. It is envisioned that there will be two additional directors appointed from Bondholders who sign up to the subsequent group action. The SPV will be the only claimant to the litigation and will decide on the litigation strategy, not the individual Bondholders. As such, after subscribing to the subsequent group action, save for the directors, it is expected that no active involvement in the litigation will be required from the Bondholders.
How much will it cost to be part of the bondholder action?
The bondholder action is being run on a "no success, no fee" basis, with all costs of the SPV paid by Omni Bridgeway pursuant to the terms of a funding agreement between it and the SPV. Omni Bridgeway will be responsible for (court) fees and/or costs the Defendant may incur in the litigation process should this group action be unsuccessful and the SPV be ordered to pay adverse costs. If you assign your claim to the SPV, you will not have to pay any costs and Omni Bridgeway shall only be entitled to a fee if the claims are successfully resolved, with the fee deducted from the proceeds of the claims on the terms of the funding agreement.
Current stage of case
Open to sign up: pre-proceedings.
The claim will be filed as an opt-in claim. This means that all persons and/or institutions who acquired Folli-Follie Bonds and have a recoverable loss are required to assign their claim to the SPV. Omni Bridgeway’s funding and adverse cost protection shall then be provided to the SPV by way of the funding agreement.
How do I sign up to obtain funding from Omni Bridgeway or receive more information?
If you wish to participate in the bondholder action, or receive further information, please contact Omni Bridgeway or Alcimos directly:
George Kintis | Managing Director | Alcimos | +44 203 575 1250 |[email protected]
Jurriaan Braat | Managing Director EMEA | Omni Bridgeway | +41 22 818 6303 | [email protected]
Henri Beelaerts | Senior Case Manager | Omni Bridgeway | +41 22 818 6304 | [email protected]
Jeremy Marshall | Senior Investment Manager | Omni Bridgeway | +44 203 968 6062| [email protected]
Or register via this website and be contacted by one of the team members above.