Geneva Connection, The (12 page)

They found a quiet corner in the lounge. Baumgart waited to see where Tara sat then deposited his hulk next to her.
The man’s a limpet
. Kent watched as Baumgart loosened his collar, relieving the pressure from his three chins.

“If you had your time over again, John, would you have raised your third fund being so dependent upon Grampian Capital? As you know, it’s most unusual to be reliant on one investor,” Baumgart said.

Kent hadn’t seen that one coming. “We didn’t set out that way. It just happened. We approached all of the usual institutional investors at the same time and expected it would take six to twelve months to raise the third fund. As you know from our fundraising document, our first two funds produced great returns, so we had a good story to tell.”

“CBC has an excellent investment record.”

“About three weeks into the process, Grampian contacted us to say they’d like to put up seven-and-a-half billion of the ten billion total target. We knew they were good for the money being one of the highest credit-rated institutions on Wall Street at that time.”

“I understand they were the cornerstone investor in both of your earlier funds.”

“Yes, that’s right. As we knew them so well, we decided to accept their large commitment; it meant we could focus our efforts back onto doing deals, rather than fundraising. I prefer deal-making to raising new capital.”

“Would you do it again?”

Kent took a moment before answering the question. A tricky one. “Knowing what subsequently happened to Grampian, it would be easy to say no but, if the exact same fundraising circumstances happened again, then I think we would. Nobody could foresee, at the time, how hard Grampian would be hit by the collapse of the US mortgage market.”

“I see.” Baumgart paused and took a sip of his double espresso.

“Do you think it was a mistake, Dieter?”

“I think it was a brave decision, but the right one in the circumstances. Now, remind me what you’re looking to raise at the moment.”

“Without Grampian in place as our cornerstone, we’ve had to cancel the two-and-half billion pound commitments from our other investors. Today we have no investment firepower at all. We’ve not been in this position before, so I can’t be too prescriptive as to what we need to achieve. Ideally, we’d be looking to replace the lost seven-and-a-half billion Grampian commitment from a handful of investors. If we achieved this, then I’m pretty confident our other investors would recommit their original amounts, taking us back up to ten billion. I’m sorry it’s a long answer.”

“So you’re looking for ten billion pounds in an ideal world?” Another sip of coffee.

“Yes. That’s right. I should’ve just said ten billion.” Kent smiled.
Is he actually going to make us an offer?

“One further question, if I may.”

“Of course. What is it?”

“We’re keen to invest directly in certain situations, rather than solely through funds managed by investment managers such as CBC. If we make a commitment to CBC, would there be an opportunity to coinvest directly in transactions? That way, we could put more capital to work without incurring your fund management fees?”

Kent was reminded how shrewd Baumgart was with this question. CBC’s smartest investors liked to have coinvestment rights as these served to dilute the impact of fund management fees, which were only charged on commitments to the fund and not on the coinvested capital.

“Of course.” Kent had nothing to lose. Besides, CBC often came across much larger deals than they could handle on their own and needed to bring in other investors alongside them to make up the required capital.

“Excellent. Then let me share with you where we are as far as your fundraising is concerned.”

Hallelujah
! “I’d be keen to hear your initial views.” It was eleven o’clock, and the lounge was already thinning out. There were only two other groups in the whole room.

“After we completed our discussion this afternoon, I spoke to our investment committee members. As you know, I chair that committee. We’ve agreed we will make a commitment to CBC. We’ve been impressed by your track record, and we believe your investment strategy, focusing as you do on distressed investment opportunities, is right for this difficult market.” Baumgart paused.

“That’s good to hear. What level of commitment did you have in mind?”
Please make it big.
Anything less than a billion will be of no use in getting CBC back on the road.

“We’ll commit twenty billion pounds.”

Kent looked at Tara and wondered whether she’d heard the same number as he did. Clearly, she had; her mouth was wide-open.
Did Baumgart really just say he wants to commit Tritona to more than twice the level committed by Grampian Capital? Fucking hell.
Kent put down his coffee cup.
There’s got to be a sting in the tail? What pound of flesh will they want in exchange?
He couldn’t be choosy and, within reason, he’d have to accept any conditions. It was hardly as though other investors were lining up to support CBC.

Before he could finish collecting his thoughts, Baumgart added, “However, there are conditions. First, we’d like to have first right to provide any coinvestment capital CBC requires for larger deals. Second, in exchange for such a large commitment, we’d want a twenty five per cent shareholding in CBC itself.”

Kent quickly did the math. This would still leave him, personally, with a controlling stake in CBC. It would still be his show; he’d still be calling the shots. With twenty billion pounds he’d be back on the road with a vengeance. With twenty billion pounds, his ambition to make one hundred million pounds personally would become a reality again. Hell, it might even become two hundred million pounds. He could no longer pretend he was giving the offer serious thought. It was obvious to everyone the Tritona proposal was a great one.

“Dieter, CBC would be absolutely delighted to accept your commitment and the associated conditions. I know we can build a substantial portfolio of fund investments with your backing. Thank you for your confidence in our team. We’ll reward it with excellent investment returns.” Kent reached out and shook Baumgart’s hand. No knuckle-crunching pain this time.

“That’s good to hear. We can settle the legal formalities over the next week or so. These need not take long; we don’t want you to be out of the market for too long. In these difficult economic times, you need to be busy tucking deals away for us.”

“I’ll make the legal documentation our top priority so we don’t risk losing deals. Thank you, again, for your faith in CBC.”

“Now, I’m afraid we must leave you as it’s getting quite late,” said Baumgart as he and his assistant stood up. Kulpman had not said a single word all night, but this no longer bothered Kent. He had a result. He could have kissed them both.

Kent and Tara walked with Baumgart to his waiting car and said their good-byes. Baumgart shook Kent’s hand again, gave Tara a kiss on both cheeks, and then left.

As the car moved out of sight, Kent yelled out loudly, “Fantastic! Absolutely, bloody fantastic!” His British reserve quickly kicked in when he realized they were drawing attention from people outside the hotel entrance. “Let’s go back inside for a celebratory drink,” he said.

“Great idea,” said Tara.

They made their way back to the lounge and sat in two comfortable armchairs, furthest away from the group of noisy Americans, who’d returned. Kent ordered a bottle of expensive champagne.

“You were wonderful tonight, Tara.” Kent clinked their glasses together.

“You did all the hard work. I was watching Baumgart as you answered his questions. I couldn’t follow all of the conversation, but he was clearly impressed. I think he decided he’s backing you. Supported by the team, of course.”

Kent knew Tara was right, but could not openly agree. He allowed himself to absorb the moment as the champagne began to increase his sense of elation. He’d rescued his firm from near certain death and had come back even stronger. With a fund of twenty billion pounds, not only was he back in the game, but now CBC would rank in the top few global firms in the private equity industry. In fact, if Baumgart was intent on putting up coinvestment monies, then CBC may even be the largest global player in terms of investment firepower. It felt good to be back. He’d dodged the bullet and come back stronger.

“Let’s have another one,” he said, already filling up their empty glasses.

Kent could feel the alcohol going straight to his head. He enjoyed the feeling. He deserved it. The last few weeks of uncertainty had been hell.

Just before midnight, he suggested they make their way back to their rooms. He could easily have ordered another bottle, but it was late, and they had a flight to catch next morning.

As they stepped out of the elevator on the fifteenth floor, Kent tripped and went crashing to the ground. He got to his feet quickly, and the two of them burst into howls of laughter. He held Tara’s hand for steadiness as they made their way to their rooms along the wide corridor.

Just before they reached Tara’s door, she dropped her card-swipe key. Kent picked it up and placed the card into the door for her, and the door opened.

“Thanks, John. Good night.” Tara began to walk into her room.

“Tara.”

She turned back round. Quickly, he put his left hand behind her neck and pulled her toward him. He kissed her for several seconds; his nostrils filled with her perfume. She put both hands around his lower back and pulled him closer. He kissed her lips and neck as she leaned against the wall next to the bed.

Kent’s placed his left hand under the short hem of her black dress. She guided his hand between her legs. Immediately, Kent felt her warmth and, as she placed her tongue into his mouth, he followed by sliding his fingers inside her. She was excited.

After a few moments, he unzipped her dress and let it fall to the floor.
She’s beautiful.
He began to kiss her shoulders and breasts. Tara dropped onto her knees and unzipped Kent’s suit trousers. She took him into her warm mouth, slowly at first and then a little faster.

Suddenly, she stopped. “John, I’m sorry. I can’t do this.” She pulled away. “It’s not right.”

He left the room and returned to his suite.
You bloody fool
. An overwhelming guilt washed over him. The night was ruined.

Chapter 16

T
HE
F
OLLOWING
M
ORNING
, Kent was down first for breakfast. He avoided eye contact when Tara came over to join him.

“I don’t know what to say,” said Kent. “I’m so sorry.”

“There’s nothing to say. We were both drunk.”

“We won’t discuss this again. It never happened.”

“That’s right. It never happened.”

Breakfast seemed to last for hours, and the conversation was punctuated with awkward silences. When they’d finished eating, Kent made some excuse about having to make a number of important calls in his room and suggested they meet in the lobby when the limo was scheduled to take them back to the airport.

They were back at CBC by two p.m. By the time they arrived, they’d reconciled themselves to the previous night’s events and had agreed to concentrate on the business success of the trip. They were both mature adults. They could move on from this.

Kent immediately called a partners’ meeting and briefed everyone on the discussions with Tritona. It was clear from their relief they’d been expecting the worst. They wanted to hear all of the details. He gave a blow-by-blow account, but they still wanted to hear more, particularly the part about their new investor’s enormous investment appetite. They couldn’t hear enough about the size of their new checkbook. Tara filled in any gaps from the notes she took during the trip.

“There are a number of action points which flow from yesterday,” said Kent, bringing the euphoria to a close. “First, we need to cover off the usual compliance checks on Tritona.” He looked at Kevin Long. “Kevin, I’d like you to deal with these. You’ll need to involve Tara in the process. She has all the details on Tritona’s corporate structure and the families behind them.”

“Sure. I’ll get right onto it. Tara, let’s have a few minutes straight after the meeting, please?” said Long. Tara nodded.

“Can you also draft a letter for me to send to the FCA? We need to inform them of these important developments,” Kent said.

“Will do.”

“Second, I’d like a strong message to go out to our other investors, telling them we’re back. It would be great if they decided to recommit their two-and-a-half billion. Adrian, can you pick this up and let me see a draft announcement tomorrow?”

“No problem,” said Johnson, smiling from ear to ear. At last he had some good news to share with his investor contacts. “I can’t wait to tell them.”

“Finally, we need to get the PR message out quickly. The market needs to know we now have a much fatter investment checkbook. We’ve had a lot of negative press lately—especially from that lunatic at the
Financial Post
. I want to rub his nose in it.” Kent stopped to take a sip of his coffee. “It’s essential we make a big splash about our ability to do deals again. We really need to ramp up the deal flow. I want us to show Tritona some early results.” Kent would normally wait for the compliance checks to be completed before announcing to the market that CBC had signed up another investor. But this was different. The compliance checks were not going to throw up any issues, and he couldn’t wait for the market to learn he’d rescued his firm and come back even stronger.