Henderson Equity Partners is a private equity firm specializing in direct, secondary direct, and fund of fund investments. It focuses on investments in Asian private equity and private equity and venture capital fund of funds. In Asia Pacific private equity, the firm primarily makes growth equity and middle market investments. Within Asian private equity, it typically invests in alternative energy, financial services, healthcare, information technology, leisure, infrastructure, consumer products, real estate, logistics, media, retail, and telecommunications. Within infrastructure, the firm invests in social, transportation, and environmental sectors. Within social, it invests in education an...
London, EC2M 3AE
Founded in 1998
Judge to Decide Litigation Options for Pension Funds Suing Henderson Equity Partners
Nov 9 12
The 22 pension funds suing Henderson Equity Partners over the management of an ill-fated infrastructure fund came a step closer to bringing their case to trial, following a three-day preliminary hearing at the High Court this week. The hearing before Judge Jeremy Cooke was to determine how the trial should proceed and whether the pension funds could bring claims against the fund manager, Henderson Equity Partners, as a group, or whether each pension fund must bring a claim individually. Other issues included whether the claimants' interpretation of what was authorized by the limited partnership agreement (LPA) and private placement memorandum (PPM) relating to the Henderson PFI Secondary Fund II was correct. The pension funds, acting under the name of 'Certain Limited Partners', claim the acquisition of PFI firm John Laing in 2006 by Henderson Equity Partners for EUR 1.2 billion, using the bulk of the 575 million fund and leverage, was in breach of mandate and that the allocation of assets and liabilities to the fund unauthorized. The claimants further argue that the acquisition exposed them unexpectedly to John Laing's liabilities, such as its PFI bidding business and non-PFI businesses such as Chiltern Railways (which has since been sold), and the company's burgeoning defined benefit pension deficit. They also allege that the bids for John Laing were made without notice, that it was not a 'permitted investment' and that there was 'no mechanism for the body of investors to be informed of the bid in advance, or to consent to it, and their consent was not sought'. The defendants allege that the investors knew that the purpose of the fundraising for the Henderson PFI Secondary Fund II was to carry out a single acquisition of a company, which owned some non-PFI assets, and that the manager of the fund could not disclose the identity of the target acquisition company as it was a listed entity. Robin Dicker, QC for the defendants, queried why the claimants had not sought to replace the manager shortly after the acquisition of John Laing, in September 2006, if they were unhappy with the purchase. Iain Milligan, QC for the claimants, said the replacement of the general partner was not a prerequisite of the derivative claim. He also asked the judge how pre-emptive costs should be ranked, but Judge Cooke said there were sufficient assets in the fund to cover costs so that ranking was not an issue. Judge Cooke said he would decide on the issues raised at the hearing before Christmas. Lawyers for the pension funds were Ashurst and for Henderson Equity Partners, Clifford Chance. If the case goes to a full trial, it is not expected to be heard before 2014. The 22 pension funds include some of the pension schemes in the UK, such as Railpen and British Steel. Other pension funds party to the litigation include BBC, BAE, Bupa, B&CE, Tesco, Smurfit Kappa, Nestle, NM Rothschild, Fenner, Magnox, Southern Electric, Kent County Council and South Tyneside, as well as Oxford Investment Partners and Trinity College Cambridge endowment funds. They represent nearly 90% by value of the fund's investors.