Forbes Media’s sale is running into trouble after the buyer refused to pay back a loan on part of the deal.
The Forbes family is suing Integrated Whale Media, the Hong Kong-based investment firm that bought Forbes Media in 2014.
The dispute seems to hang on a conversation that may — or may not — have taken place between Timothy Forbes (son of Malcolm Forbes and grandson of the publication’s founder) and Sammy Wong, an executive who led the group of buyers.
According to the suit, which presents the Forbes family’s version of events: Wong is claiming that Timothy Forbes promised him that the defaulted payment would be forgiven. Forbes claims that discussion never took place.
This is an edited portion of the lawsuit. The suit was filed in Delaware, but it refers to an earlier suit filed in the British Virgin Islands.
“Not only was no waiver given, but Mr. Forbes delivered the exact opposite message at that meeting and demanded immediate payment of the overdue interest. There is not a single document or piece of correspondence that mentions the alleged oral waiver that Integrated Whale raised, for the first time, in the litigation in the British Virgin Islands.
In fact, all correspondence following the meeting confirms the fact that no such waiver was ever given. The matter of Integrated Whale’s potential liquidation remains pending.”
The endgame from the ongoing litigation is that Forbes Media’s ownership could be returned to Forbes family, and Elevation Partners, the private equity firm that held a stake in the company. Integrated Whale Media could lose out on more than $US350 million it already paid out, according to a person with knowledge with the matter.
The full purchase price, including earnouts, was reportedly $US475 million, but because the copy of the lawsuit is heavily redacted, details regarding the deal value can’t be confirmed.
Representatives at Forbes, Integrated Whale’s Hong Kong office, and Elevation Partners did not immediately respond to requests for comment.
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