The family behind Forbes Media is suing Hong Kong investors Integrated Whale Media Investments over an alleged breach of payment for a controlling stake that was purchased by IWMI last year.
After 97 years of ownership, the Forbes family sold a controlling stake in Forbes Media to IWMI in June 2014 for an undisclosed amount. It is understood that IWMI borrowed money from Forbes to finance the deal. Now, however, the partnership appears to have turned sour. In the lawsuit filed last week, the Forbes family says that IWMI has 'wasted' corporate assets and abused its position as a controlling shareholder, and accuses IWMI of breaching the terms of its purchase agreement and failing to make payments on time.
'From the outset of the supposed partnership, Integrated Whale and its principals have steadfastly refused to pay what they clearly owe, and instead have made a series of baseless—and often patently false—excuses and pretexts for their refusal to honour their basic contractual commitments,' the lawsuit reads. The document alleges that IWMI failed to make its quarterly payment to Forbes on 1 October last year, and suggests that the investor tried to resist efforts to collect the unpaid debt 'by any means, no matter how improper, including submitting false testimony to the court of the British Virgin Islands' (where IWMI is registered).
In a statement released on Monday, IWMI rejected the Forbes' allegations as 'completely without merit', and assured that the lawsuit was a mere dispute between shareholders which will not adversely impact the day-to-day operations or future growth of Forbes Media. Sources: BBC; Financial Times