CAYMAN ISLANDS GRAND COURT SATISFIED THAT WHITE CRYSTAL’S CONCERNS WERE “GENUINE”

The Grand Court of the Cayman Islands has upheld the enforcement of London Court of International Arbitration (LCIA) award requiring “disclosure of records”. The Court also rejected an application by General Partner IGCF to set aside an order for enforcement of the award.

The Infrastructure Growth & Capital Fund (IGCF) is a $2 billion investment fund hosting investments from multiple investors mainly from the Middle East and EU region and whose biggest primary asset is a $1.6 billion stake in a Karachi based power utility. The fund is managed by the IGCF General Partner (GP) and was formerly owned by Dubai based private equity firm Abraaj Group before it collapsed in 2018.

The fund in question, the IGCF, is now led by Mark Gerald Skelton of Alvarez & Marsal’s (A&M) the lead Liquidators appointed by the investors post Abraaj collapsed. The hearing were also attended by other concerned and pertinent parties to this case which included legal representatives from the Mashreq Bank, Ernst & Young and the PWC being the liquidator for Abraaj Holdings who also had a substantial stake in the IGCF Fund as an investor.

In line with details available as per the court’s document, White Crystals, a special purpose vehicle set up by Saudi Arabia’s Al Jomaih Group to invest in IGCF, brought the arbitration against the General Partner under an LCIA clause in the deed of limited partnership for IGCF. It said the claim was prompted by serious concerns that a Pakistani Businessman Shehryar Chishty was running IGCF for his own benefit and not that of the limited partners.

The claimant White Crystal of Al Jomaih Group has argued that the IGCF GP had entered into a loan agreement with a company called Asiapak Investments owned by Pakistani businessman Shehryar Chishty, at an alarming rate of interest of up to 60% per annum compounded monthly. It was also raised that Asiapak had obtained security over all of IGCF’s remaining assets. It was further contended that approximately US$66 million belonging to the IGCF fund under supervisory control of Mark Gerald Skelton had been “moved from bank to bank” in Pakistan and had ended up in a bank account in the name of one of Pakistani businessman Shehryar Chishty’s companies.

It was alleged in the court that Asiapak Investments owned by Pakistani businessman, known for running a privately held transport company, Daewoo Express, was also exercising his control to prevent KES Power’s board from resolving to appoint solicitors to defend the English litigation, and that the businessman has directed another IGCF entity in the Cayman court for the winding up of KES Power based on the forced deadlock among its board.

The Grand Court of the Cayman Islands was satisfied that Saudi Investors Aljomaih Group’s concerns filed via the White Crystals’ about these matters were genuinely held and ordered that the books and records should be turned over within five days of the award.

The general partner applied to discharge or vary the order on grounds of public policy and sought an injunction to restrain White Crystals from using the books and records, once obtained, on grounds of confidentiality.

At the recent hearing in person, the Chief Justice of the Cayman Islands Margaret Ramsay-Hale, sitting in the Grand Court rejected those applications. The Judge held that the IGCF GP was looking to amend the Award by adding a confidentiality rider, which the Court did not have jurisdiction to do and which was not required as a matter of public policy. On the contrary, public policy required the Court to enforce the Award on its terms, the judge noted. She also affirmed the open justice principle by refusing the IGCF GP’s application to sit in private. A summary judgment has been issued, while the Grand Court’s written judgment will be handed down at a later date.

Al-Jomaih of Saudi Kingdom has also challenged Shehryar Chishty’s Asiapak Investments acquisition of control over the IGCF in the Pakistani courts.