Investor Once Head Of £3.5B Empire Declared Bankrupt After 7-Year Fight

Santander's Madrid Hq

Glenn Maud, an investor who during the last boom bought some of the world’s most expensive buildings, has been declared bankrupt after losing a near seven-year court battle.

Maud was declared bankrupt in November following a petition lodged in 2014 from Libya’s sovereign wealth fund, a notice from the High Court of Justice shows.

The bankruptcy order comes after a complex legal battle involving the Libyan Investment Authority, Maud’s former joint venture partner Derek Quinlan and fellow boom-time property investor Robert Tchenguiz. The case centred around the ownership of Santander’s Madrid HQ, one of the world’s most valuable and highly leveraged property assets.

A judge found against Maud in his battle in June, and an appeal against the decision came to naught, leading to the November bankruptcy order. Maud declined to comment on the order.

Maud built up an empire once valued at £3.5B before the 2008 crash, investing either in his own name or through his company, Propinvest.

He bought trophy assets including Citi’s £1B London HQ using complex financial structures and very high levels of debt.

His largest purchase was Ciudad Santander, the 4.3M SF headquarters of Spanish bank Santander. The Madrid HQ is spread over 340 acres and includes a grove of 1,000-year-old olive trees, a championship golf course and a nursery that can accommodate 550 children.

The building was bought for just shy of €2B in 2008, with the deal completing on the day Lehman Brothers collapsed.

A group of banks provided €1.575B in senior debt to fund the purchase, Royal Bank of Scotland provided a €200M junior loan and a €75M personal loan, and Maud and Quinlan put up just €75M of equity, €12.5M of which Maud borrowed from the Libyan fund, which was set up in 2004 to invest profits from the country’s oil reserves.

The credit crunch sent the value of the building plummeting, and the special purpose vehicle that owned it went into bankruptcy in 2014. Tchenguiz teamed up with Abu Dhabi fund Aabar in 2010 to buy RBS’ loans to the property and the personal loans to Maud and Quinlan to try and take control of the building.

When Maud did not repay the debts, the LIA and Tchenguiz and Aabar sought to have him declared bankrupt. Maud argued that Tchenguiz and Aabar were only doing this to take control of the Santander HQ, which would be against bankruptcy laws, and said he had tried to repay the LIA but was unable to do so because sanctions against Libya made paying it back illegal.

The judge in the case ultimately found in favour of the LIA, which is owed €17M including interest.

He said although Maud had argued he had no assets to repay creditors, he had enough assets to fund years of complex litigation in multiple countries.

The building was bought by the Reuben Brothers, who then sold it on to Santander for about €3B.

The legal wrangling over the deal is not over yet, with litigation in Spain still ongoing which could see Maud recoup some of the profits from the recent sale.

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