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M&A advisers sued for ‘not paying fees’ on AA sale

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Mergers and acquisitions consultants Dean Street Advisers are being sued for €660,000 (£560,000) by a former contractor who claims the firm never paid him for helping sell the AA’s Irish motoring arm.

However, London-based Dean Street denies it owes investment banker Richard Samuel the money and claims he broke his contract by engaging in personal deals that could have posed a regulatory risk to Dean Street.

Samuel says he was contracted by Dean Street in October 2014 to find and carry out corporate finance deals for the firm.

Papers filed at the High Court uncovered by Money Marketing say Samuel’s “client connection” with the AA Corporation was so strong that he was the the car club’s first choice for any corporate finance deal, regardless of which firm he was working for.

As a result, Samuel says his contract with Dean Street outlined that he would get 40 per cent of any revenue he secured from AA.

In January 2016 the AA hired Samuel to provide corporate finance services to help it sell its Irish motoring arm, AA Ireland.

The work included finding and introducing interested buyers and reviewing offers.

Holding to contract

The court papers say Dean Street expected a fee of around €1.65m for the deal, and that Samuel expected around €660,000 of that.

However, Samuel claims that in June 2016 he was told that the €660,000 figure was too high by Dean Street co-founder Mervyn Metcalf.

The court papers say: “Mr Metcalf stated words the gist of which was ‘…you’re obviously not going to hold us to the terms of your contract regarding the fee on the AA…’.”

Metcalf then suggested Samuel accept payment of around €292,000, which he rejected.

Samuel says he was then let go on 4 July and was asked to leave Dean Street’s offices.

Samuel says he has received no money at all from the AA deal, and is still expecting payment of €660,000, according to a claim filed in January and recently made public.

Personal deals

However, Dean Street’s defence denies the claims. The firm says Samuel is not owed any money because his contract only entitled him to a share in cash received, and that Dean Street did not get the AA money until August 2016, after Samuel left.

Additionally, Dean Street says Samuel’s contract only entitles him to a 40 per cent share in deals relating to AA debt restructuring, not any AA corporate financing deal.

Dean Street also says Samuel did not source the disputed AA deal, and that Dean Street had already started work on this before he found out about it.

Dean Street says it ended Samuel’s contract due to him revealing confidential information on its clients to firms including the AA and Cathelco.

The adviser firm also claims Samuel was secretly using the Dean Street name to try to secure personal deals without telling the firm.

These alleged deals posed a regulatory risk to Dean Street as they involved Iranian petrochemicals, African gold, Russian jet fuel and Nigerian oil, including direct contact with a former Nigerian president.

The Dean Street defence says: “All of these markets and transaction types were of concern in light of the defendant’s regulated status.”

The merger adviser further claims that Samuel also broke his contract by selling personal AA shares without getting the required permission.

Dean Street declined to comment further. Samuel’s legal representatives, Berg, did not respond to requests for comment.

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