Barclay twins accused of 'scheming' to control firm

Sir David Barclay (left) and Sir Frederick are accused of scheming to oust Paddy McKillen

The Barclay brothers have been accused of "scheming" to take control of a firm that owns three of London's top hotels.

Sir David and Sir Frederick Barclay "infringed" Belfast-born Paddy McKillen's rights as a director of Coroin, the High Court heard.

The three leading businessmen are in a High Court battle over the control of three of London's most famous hotels.

Paddy McKillen, from Belfast, wants to block a "takeover plan" by twins Sir David and Sir Frederick Barclay.

All three entrepreneurs invested in Coroin, the company which owns the Connaught, Claridges and the Berkeley.

Mr McKillen said the pair "engaged in a scheme" to take control of the firm.

The twins deny the allegations and say Mr McKillen is "tarnishing" them.

On the second day of the trial, the High Court heard Mr McKillen claimed he was the victim of "unlawfulness" and "unfairly prejudicial conduct".

The Barclay brothers, who grew up in London, claim Mr McKillen, now based in Dublin, is trying to tarnish their reputations and embarrass them.

In a written witness statement, Mr McKillen told judge Mr Justice David Richards: "Since at least January 2011, the Barclay brothers and their interests have been engaged in a scheme to take over the company and in doing so I believe they have infringed and diminished my rights as a shareholder and director."

He said the Barclay brothers' objective was to "oust" him from Coroin.

'Quality assets'

Mr McKillen told the judge in his witness statement that he had "engaged in business and property development" in Ireland and internationally for about 35 years.

He described himself as an "investor in and developer of quality international properties, preferably in the retail and hotel industries".

Mr McKillen said that since the 1970s he had built a "diverse portfolio" of "quality assets" in countries including: England, France, Ireland, Germany, Japan, Vietnam, Argentina and the United States.

He said he became a shareholder in Coroin - a holding company for the Maybourne Hotel Group, which was made up of Claridge's, the Connaught and the Berkeley - in 2004.

Mr McKillen said the group was then known as the Savoy Group and also included the Savoy Hotel.

'Horrified' with Savoy

"It was rare to see such trophy assets on the market," said Mr McKillen in his statement. "I ... felt I could not let the opportunity to purchase such iconic brands pass me by."

Paddy McKillen said he had built a "diverse portfolio" since the 1970s

Mr McKillen said a deal worth nearly £800m was completed in May 2004 and he paid £25m for a 20% shareholding. A syndicate including the Anglo Irish Bank and Bank of Ireland had provided a £675m loan, he said.

He said he was "horrified" at the "condition" of the Savoy and agreed with other investors that it should be sold.

"It was clear to me that the Savoy was in a poor state and would require significant investment," said Mr McKillen. "I was never as impressed with the Savoy as with the other three hotels."

He said the Savoy was sold for £230m in 2005 to a billionaire member of the Saudi royal family - Prince Al-Waleed Bin Talal - after a meeting on the prince's boat in Cannes, France.

Mr McKillen said between 2004 and 2011, the value of Claridge's had risen from £275m to more than £460m, the Berkeley from £185m to more than £300m and the Connaught from £70m to more than £220m.

"I believe that I have demonstrated an ability to run the development of the hotels successfully," he said. "I believe the choices I have made have proven to be good ones."

The case continues.