Bondholders take FNG to court

About fifty FNG bondholders are going to court: they are suing both the fashion company and the three founders, who they claim have deliberately deceived them. 

Not the mother but a distant daughter

A group of displeased FNG bondholders is suing the company itself and founders Dieter Penninckx, Anja Maes and Manu Bracke. Belgian newspaper De Standaard reports. After its bankruptcy over the summer of 2020, the many bondholders were left empty-handed, while, in the meantime, there is talk of a second relaunch at the top.

According to the bondholders, there was deliberate deception at play: the structure of FNG seems to have been set up in such a way that the fashion group, formerly owner of Brantano and numerous other chains, could, like a lizard, moult endlessly and thus leave behind “dead” or unwanted components. Specifically, the investors say that they thought they were investing in the top layer of the group, while ultimately, it was only one of the many subsidiaries.

New relaunch in the making

That is how the company FNG could continue to exist after the bankruptcy and how it can prepare a new relaunch today. In June, the shareholders will have to vote on a new board of directors, new articles of association and a discharge from the founders, who are under suspicion. The relaunch is necessary to bring the only remaining part, e-commerce platform Ellos, to the stock exchange. The fact that the founders are still the largest shareholders, with double voting rights, does not please the small shareholders, in particular. Their backs are against the wall if they want to see any of their money.

Because of the complex structure, the bondholders have had nothing to say in the matter since the bankruptcy. The banks also suffered the same fate: their loans went to subsidiaries dangling at the bottom of the company, protecting the top layer. In March, they already demanded compensation of 200 million euros. The group of fifty bondholders is claiming 15 million euros. However, another fifty or so bondholders are likely to join them, raising the claim to 25 million euros. A lawsuit may also be filed against the other suspects in the case, namely law firm NautaDutilh, lawyer Elke Janssens and consultant Kristof Van Hecke.