As the world entered a state of lockdown, German financier Lars Windhorst took a private jet across the world to raise billions of dollars in funding.
The 44-year-old needs to fulfill his promise to repurchase more than 1 billion euros of bonds from H2O Asset Management, a once-respected European fund manager whose support helped Windhorst form a series of eclectic Of companies, including Italian underwear manufacturer La Pera and German football club Hertha Berlin.
After H2O’s hyper-scale bets on financiers threatened to overthrow asset management companies in 2019, Windhorst last year Vow to repurchase Illiquid debt crisis This has led to regulatory review. But more than 12 months later, H2O customers, whose funds are trapped in troublesome securities, are still waiting.
For Windhorst, the challenge is one of the toughest challenges to date. When he entered the business world in the mid-1990s, then German Chancellor Helmut Kohl praised him as a precocious entrepreneur. career Including personal bankruptcy.
One Initial planning Last year, half of the bonds were repurchased using an investment tool called Evergreen, and the rest fell apart in June this year. Then in August last year, French regulators ordered H2O Suspend several funds Due to the uncertainty of bond valuation.
This London-based asset management company operates write down The value of the securities, in some cases, Windhorst has agreed to repurchase several years before maturity and transfer it to the so-called side pocket that does not accept redemption by investors.
A sort of Criminal investigation The investigation initiated by the Berlin Prosecutor’s Office to Winhorst is a more complex issue.The authorities are Probe Whether Evergreen violated German law for allegedly engaging in banking activities without the necessary permits. Windhorst denied any wrongdoing and stated that he had provided assistance to the authorities.
With infectious optimism, an insatiable desire for transactions, and an incredible ability to escape a near-destructive plight, Windhorst insists that a large amount of debt will be repurchased this year.
“Tylenol [Windhorst’s main investment company] It is expected that the major part of the H2O debt will be repaid by the end of the year,” Windhorst told the Financial Times.
After the failure of the Evergreen plan, Windhorst bought some breathing space for itself, until Tennor announced in May early next year that it would reorganize its debts with “primary creditors”, with the largest creditor being H2O.
According to the agreement, Tennor Group’s debt will be consolidated into a new 1.45 billion euro bond with an interest rate of 4.5%, which will be repaid in early 2022. H2O stated that the agreement provides a “more stable platform” to clear the securities in the fund’s side pockets.
Bet on Hertha Berlin
Windhorst operates a stylish office in Mayfair, London and a new base in Zurich’s expensive “Palme” office building once occupied by Russian oligarch Viktor Vekselberg. He said he was tired of the scrutiny of his relationship with H2O.
“It is normal to encounter difficulties in business. This is not a problem for me, I will deal with it,” Windhorst said. “I was beaten for this. We need to move on, make money and do business.”
It is difficult to clearly understand Tennor’s financial situation. La Perla is one of its most high-profile investments, with a loss of 136 million euros last year. However, the accounts of several subsidiaries have not yet been signed, and the document states that Tennor’s audited accounts originally scheduled to be submitted at the end of March were delayed in finalizing.
According to the latest publicly released 2019 temporary balance sheet document, Tennor Holdings had a debt of 2.6 billion euros at the end of the year.
Windhorst has long funded his business through debt and short-term financing transactions (including repurchase agreements). This is the model he said he wanted to break.
However, the shadow cast by H2O did not weaken Windhorst’s ambitions. The financier is expected to complete his 374 million euro investment in Hertha Berlin, a German football club with a long history but basically empty trophy cabinets.The agreement to acquire a majority stake is Announce Just a week after the H2O scandal broke out in 2019.
In June, he dismissed rumors on Twitter that he was lagging behind in paying the club. “Say hello to all doubters who don’t believe this is my account,” Windhorst declared. “Everything went according to plan,” Hertha Berlin’s treasurer Bjorn Bahrain told the Financial Times. The last installment of 30 million euros will be due this month.
Since Wendhorst took office, Hertha Berlin broke the player transfer record, but only 10 weeks later in February 2020 lost a manager, the legendary German forward Jurgen Klinsmann.
Earlier this year, a creditor obtained a judgment in a Dutch court requiring the auction of the investment vehicle Windhorst used to purchase its shares in Hertha Berlin. According to a creditor’s lawyer, the lawsuit involving short-term loans has been “generally settled.”
Although the H2O bill is still pending, the investment in Hertha Berlin is one of many requirements for Windhorst.
Shortly before H2O described financiers’ efforts to repurchase bonds under the Evergreen program in August 2020 as “very partial,” Tennor promised 100 million euros for medical robotics startups Avatra Medical.
It also announced a major stake Joint venture Cooperated with Extell, a New York-based luxury apartment developer, to build a project aimed at becoming the tallest skyscraper in Manhattan. Despite the slow progress after the plan was opposed, Windhorst believes that the project will be the “best time” for the ultimate recovery of the luxury residential market in Manhattan.
Windhorst also expanded his shipping business. Tennor first acquired the troubled shipyard Flensburger Schiffbau-Gesellschaft from Norwegian businessman Kristian Siem in 2019. Since restarting operations after bankruptcy proceedings, FSG laid the keel for the first ship at the end of last year. Customer: A company under Windhorst.
Then last month, FSG acquired Nobiskrug, a luxury yacht shipyard in Germany, for an undisclosed price. Nobiskrug, once owned by French billionaire Iskander Safa’s Privinvest, went bankrupt in April.
Windhorst said: “The two shipyards together have received more than 1 billion euros in orders.”
If dependence on debt has always been a feature of his business career, so have legal disputes.
Earlier this year, Siem Reap filed a lawsuit in the High Court of London. At the same time, in June, a judge in Amsterdam ordered Windhorst to “disclose his assets and provide security” because he acquired a 50% stake in the United States from the United States in the International Equestrian Jumping Global Championship Tour worth 169 million euros. . Billionaire Frank McCourt.
Windhorst insists that the public documents paint a misleading picture. He said that all lawsuits have been settled amicably except for those filed by entities associated with Manfredi Lefebvre d’Ovidio, a former member of Tennor’s advisory board, and these entities have filed claims worth more than 120 million euros. Representatives for Siem, Lefebvre d’Ovidio and McCourt declined to comment.
There are signs that the businessman’s crazy flight plan is beginning to pay off. In May of this year, Windhorst sold his 90% stake in Berlin advertising technology company Fyber to Digital Turbine, which is listed on NASDAQ, at a valuation of $600 million. The transaction was settled with US$150 million in cash and shares in Digital Turbine.
At the same time, Windhorst stated that Tennor has agreed to sell a minority stake in Avatera for 600 million euros. As a startup company in the rapidly growing field of medical robotics, Avatera has long been considered a potential crown in Tennor’s portfolio.
H2O disclosed in a company document that it was unable to dispose of 12.5% of Avatera shares held by its funds in an “orderly manner” earlier this year. A spokesperson said that the priority of asset management companies is The price is sold.
Although Avatera may require significant investment to realize its potential, Windhorst remains bullish. “Avatera has the potential to become a 10 billion to 20 billion euro company,” he said.
If true, this will mark a significant shift for financiers.But since H2O has been Winhorst’s savior, To support his empire because he fought against aggressive creditors, including one that was associated with a Belize-based company Former Russian Minister of Energy, It is the customers of asset management companies that still need to be rescued.
Gerard Maurin is an investor who is leading some people to claim against H2O. He said that the communication of asset management companies regarding the repayment schedule has been vague.
“It motivates us to continue our actions,” he said. “It’s not normal to have to wait [to redeem your investment]. “