The founder of Frasers Group is suing Morgan Stanley for around £40 million. Photo: Eddie Mulholland for the Telegraph
Mike Ashley said he was «a victim of abuse at the hands of Morgan Stanley» after the Wall Street bank demanded $1 billion (£790 million) from his retail empire.
< p>Mr Ashley, who is suing the lender for trying to force his company Frasers Group to back out of bets on the May 2021 share price, suggested the demand for money was unfair and motivated by snobbery.
Giving evidence in the High Court, the billionaire said he did not have the means to pay the money and as a result it risked causing serious damage to his company.
He said: “I already said it.” I didn't have it under my bed before. I couldn’t do more than I did – it’s unfair.”
Mr Ashley's bets on German retailer Hugo Boss risked being shut down by Morgan Stanley using a process known as a margin call. , where parties are asked to contribute additional funds to support their investment positions.
The Wall Street bank did not deal directly with Mr. Ashley, but instead referred the margin call to an intermediary, Saxo Bank, after learning that the eventual In the end, it was he who was behind the transactions.
Frasers is now suing Morgan Stanley for about a euro. 47 million pounds sterling (£40 million) for alleged lost trading profits and costs of transferring trades to rival lender HSBC.
In court papers, quoting bank officials, Frasers said Mr Ashley was considered «an upstart» who has «no respect for the norms of doing business.»
Asked by a Morgan Stanley lawyer if he really believed the allegations, Mr. Ashley responded Thursday: «I believe there is a some truth.”
Mr Ashley, who is worth about He said Morgan Stanley threatened to pull the plug even after offering to place Hugo Boss shares and £100m in cash as collateral.
He said: “I became victim of abuse by Morgan Stanley.
The tycoon argued that if Frasers had borrowed money from HSBC to meet the margin call, then Morgan Stanley would have returned with further demands for collateral, and would have added “nothing else.”
He told the High Court: «I've offered them the world and it's not enough — it's really starting to irritate me.»
The retailer has already spent between £3 million and £5 million on a legal battle against Morgan Stanley, which Mr. n According to Ashley, this is “a small amount of money compared to Frasers.”
He argued that the main purpose of the lawsuit is to show how “grotesque and unfair Morgan Stanley acted.”
These costs include Frasers' claims in US courts to compel James Gorman, the former chief executive of Morgan Stanley, to testify and provide evidence in the UK claim.
Morgan Stanley rejects the claim as frivolous and without merit, arguing that the margin call was intended to protect the company from a potential 400% rise in Hugo Boss shares.
Mr Ashley said Frasers was also covering separate costs for his own data protection claim against Morgan Stanley, filed in US Supreme Court. Trial earlier this month.
The case continues.
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