BL-2022-002117 - [2025] EWHC 2794 (Ch)

On 9 March 2017, Mr Mapp emailed Peter Marples to suggest an introduction to his friend Tony Mallin, the principal of Star Capital Partnerships LLP (“Star Capital”). This led to an exchange between Mr Mallin and Mr Mapp and then to a meeting planned for early May 2017.

Prior to any such meeting, the Company reviewed various information requests from Star Capital, and in an email of 23 April 2017, Mr Marples set out his progress on those requests to date. In his covering email he expressed the view that the business had an enterprise value of £115 million, involving “cash on the nose of not less than £85m with a £30m earnout”. In cross-examination, Mr Marples confirmed that this was indeed his view as to the enterprise value of the business at the time.

A proposal seems to have been rejected by 19 May 2017. But by 7 July 2017, and as recorded in the Company’s minutes of a board meeting of that date, the potential deal had been refined, with “an offer of £5m of working capital for 12% of the business with a put and call for the remainder of the business under certain criteria”.

Discussions between the parties then ceased for a period, but in mid-October 2017, Star Capital reached out to Mr Mapp to propose an update session, and although Mr Mapp suggested postponing any such session until January or February 2018 (referring to how well the business had grown), Star Capital indicated that it was “happy to re-engage when [the Company] [felt] the time [was] right”.

The Defendant says that this episode is incompatible with the idea that the Claimants were completely unable to sell their shares. Peter Marples said that these discussions with Star Capital represented a mezzanine debt proposal but Mr Davidson was adamant that the documents referred to an investment in the company and were not consistent with a proposal for mezzanine finance, and I agree - a proposal for mezzanine finance is not consistent with the board minutes recording a proposed acquisition of 12% with a put and call option “for the remainder of the business”.