Credit Suisse Fund accuses SoftBank of over $ 440 million investment


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A Credit Suisse Group AG

CS 1.68%

Fund accuses SoftBank Group Corp.

9984 -0.59%

in U.S. court filings about orchestrating transactions that worthless a $ 440 million investment made by the Fund to finance a SoftBank-backed company.

The motion filed Thursday in a US district court in California asked a federal judge to allow the Credit Suisse fund to serve a subpoena against a US branch of SoftBank. The motion, which says the fund is preparing a lawsuit against SoftBank in the UK, deepens the dispute over the demise of Greensill Capital, a supply chain finance company that went bankrupt earlier this year.

Greensill made loans to companies to advance expected payments from customers of those companies; Greensill packed the loans into securities bought by the Credit Suisse-operated mutual funds.

One such company was Katerra Inc., a US construction company. The Credit Suisse fund held $ 440 million in notes backed by Greensill’s loan to Katerra, and when Katerra got into financial trouble last year, Greensill made the loan.

SoftBank was an investor in both Greensill and Katerra, and in the US court filing the Credit Suisse fund, SoftBank said that SoftBank had “struck a deal” to cut the fund from all possible income, without to notify the fund.

A spokeswoman for SoftBank declined to comment, as did a spokeswoman for Credit Suisse.

SoftBank invested money in Greensill in late 2020, and Credit Suisse executives expected the money to flow into their funds to redeem the Katerra loan – instead, it ended up in Greensill’s German banking unit, the Wall Street Journal reported in April.

In June, the Journal reported that Credit Suisse had terminated a personal banking relationship with SoftBank founder Masayoshi Son and had cracked down on transactions with the company.

The court motion filed on Thursday is known as a Section 1782 petition that allows a party to request a U.S. court to order evidence for a trial outside of the U.S. The Credit Suisse Fund argues that it has taken enough steps to sue SoftBank in the UK to justify the subpoena, which is seeking a multitude of documents.

Write to Charles Trout at [email protected]

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