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Lex Greensill has told London’s High Court that he still suffers from post-traumatic stress disorder after fraught negotiations with Japan’s SoftBank as he sought funding to save his lending firm that collapsed in 2021.
Over two days in the witness box — his first public testimony since Greensill Capital collapsed into administration in March 2021 — the Australian financier detailed bruising talks with the Japanese technology group over emergency funds in late 2020.
Greensill described SoftBank as an “intensely political” organisation that had insisted on “silence” around a controversial transaction that could have spooked SoftBank investors. He accused SoftBank founder Masayoshi Son of reneging on a crucial verbal agreement, and then extracting “painful” terms from him during late-night negotiations.
The financier, who wore a crisp blue suit and sported a neat beard, is not a defendant in the case, which relates to a dispute between an investment fund of Credit Suisse and SoftBank.
The Credit Suisse fund is seeking more than $440mn from SoftBank that was allegedly earmarked to cover losses suffered by clients of the defunct Swiss bank from investments linked to Greensill Capital.
SoftBank denies the claims, and its lawyers said the case was “a classic example of claimants casting around for a party with deep pockets on whom they seek to pin blame for a loss caused by their own negligence”.
In written submissions, the Japanese group’s lawyers also said Greensill “displayed hostility” towards SoftBank in a 2021 interview with a liquidator, where he claimed his company had “got thoroughly fucked” by SoftBank.
SoftBank’s Vision Funds were a major investor in Greensill Capital, pouring $1.5bn into the invoice lending start-up in 2019.
Greensill told the court that Son had agreed to mentor him during “often weekly” trips to Tokyo, praising the Japanese multibillionaire as someone who can “look over the horizon in a way most ordinary mortals can’t”.
But the relationship later soured. Greensill told the court that Son had made a “verbal commitment” to guarantee a risky loan to one of the Vision Fund’s companies, only for the SoftBank’s founder to later say he did not remember the conversation.
This led to a series of fraught negotiations in which SoftBank agreed to provide $440mn, which would help cover losses for Greensill Capital’s investors on a restructuring of the company, US construction start-up Katerra. SoftBank also gained a larger stake in the Australian financier’s firm and other sweeteners in return for the funds.
Greensill said Son also “extracted a personal guarantee” from him worth $50mn during a phone call in the early hours of the morning. He told the court that these talks left him with “third-degree burns to most of my body”.
Additional negotiations around a potential further $1.5bn emergency loan from SoftBank took place over the Christmas period in 2020. Greensill said he was fielding a “gazillion” calls at this time, describing his birthday in late December as “one of the least pleasant days of my life” as it became clear that SoftBank was unlikely to grant the loan.
Greensill said there had been a “cone of silence” around negotiations with SoftBank over the Katerra restructuring, which he said was arranged to avoid SoftBank taking an immediate hit to its profit-and-loss statement.
“They didn’t want the world to know, because it would have been very bad for their share price,” Greensill claimed.
Greensill confirmed to the court that he had previously told the liquidator of one of his companies that Son had used SoftBank’s stock to fund his lifestyle.
According to the transcript of the interview, which was released to journalists covering proceedings, Greensill told the liquidator: “What a lot of people don’t know is that basically Masa lives a very big lifestyle, which is funded by borrowing against his SoftBank stock.”
The trial continues.
