Mr Justice Lightman gave the go-ahead in the High Court yesterday for CWS to commence an action for damages against Hambros. The case centres on confidential documents provided to Mr Regan's bidding vehicle, Galileo, by two senior CWS executives and then circulated to 17 City institutions and companies by Hambros, Mr Regan's advisers.
The list included several banks, which Hambros approached to provide financing for the deal. Most declined to support the bid, but Nomura was about to complete a pounds 1.2bn deal before it withdrew this week. Banking sources said Nomura had failed to receive assurances from Galileo about the provenance of the information on CWS.
CWS is taking legal action against the bank as a whole, not the individual employees who worked on behalf of Mr Regan. The main figures at Hambros who worked on the bid for CWS were Peter Large and Andrew Salmon.
A spokesman for Hambros said last night that it could not make any comment on the affair now that legal proceedings had started.
Graham Melmoth, chief executive of the CWS, wrote to Lord Hambro, chairman of Hambros, saying: "It is inconceivable that anyone could have concluded that the documents had been obtained by legitimate means from a legitimate source."
Hambros continued its support to the bitter end. It was only the decision of Nomura International to withdraw its pounds 1.2bn of debt finance which finally forced Mr Regan to concede defeat.
UBS was approached by Hambros on 16 April to take part in the financing of the Regan bid. It is understood it received documents the following day. However, the negative publicity surrounding the deal deterred the bank from supporting the bid.
Goldman Sachs, the US investment bank, was another institution on the list of names that had seen the documents. In a statement they said: "Goldman Sachs was represented at a presentation given by Hambros and Galileo in late March.
"We decided immediately and made clear to the other parties within days that we were not interested in proposals put forward in respect of CWS. Documents received were handed back to Hambros immediately when they were requested."
How Co-op uncovered the scandal
The trail that led the CWS to the conspirators in its ranks started with a hotel bill submitted in an expenses claim. The claim was submitted by David Chambers, the CWS's head of buying and marketing and clearly shows the Babmaes Street address which is the head office of Andrew Regan's Lanica Trust. Lanica had booked the room on behalf of Mr Chambers, whose name is circled above. The expense claim started a trail of logged telephone calls and filmed meetings which connected Mr Chambers and Allan Green, the retail controller, with the Regan camp. Both were later suspended.Reuse content