Walker survives but banks to fight on

BANKS owed more than pounds 40m by George Walker are preparing a challenge to the validity of yesterday's creditors' meeting at which the former boxer and chairman of Brent Walker avoided moves to have him declared bankrupt.

At the meeting, creditors owed pounds 180m voted by the narrowest of margins to accept an individual voluntary arrangement proposed by Mr Walker that could leave creditors with as little as one twelfth of a penny in the pound for their debts.

If the arrangement stands, Mr Walker will be free to carry on with his business career. A formal bankruptcy order imposes severe restrictions including disqualification from directorships. It also makes it difficult to own credit cards.

Creditors owed pounds 136.5m voted in favour - representing 75.8 per cent of those creditors accepted by Raymond Hocking of Stoy Hayward, the accountant chairing the meeting, as being owed money by Mr Walker.

Anything less than 75 per cent would have meant the scheme failed and creditors could apply for Mr Walker to be made bankrupt.

Mr Walker said he felt 'wonderful' about the result. 'Now I can get on with my life,' he said. This will include a job as chief executive of Walkers International, a Bermuda company owned by Mr Walker's wife Jean that sells cigarette machines in Russia. Mrs Walker owns a house in Essex and a chateau in France in which the Walkers live.

The narrowness of the vote was shown by a comment from Mr Walker's lawyer, Michael Coleman of Harkavy's, who said that if the exchange rates had been the same today as they were 10 days ago, Mr Walker might have lost.

The key votes in his favour were understood to be Arab Banking Corporation, which was said to be owed pounds 33.1m, and the Inland Revenue, said to be owed pounds 40m.

The Inland Revenue's vote, which was unusual, could lead to the Treasury giving up on all but pounds 30,000 of its claim. However, other creditors were bemused as to how the Revenue's claim ballooned from the pounds 500,000 Mr Walker said he owed it a year ago. No one from the Revenue was prepared to comment when contacted yesterday.

The banks that voted against the agreement, including TSB, Standard Chartered and Svenska, are understood to be preparing a challenge to the way the vote was taken. Mr Hocking allowed pounds 43.8m of claims from Bacchus Trust, Romla Walker, New World Trust, Thorn Trust and Holt Freres, all of which are connected to the Walker family. A large number of these claims were sent by fax in the hours before the meeting, and lawyers for the banks may challenge their validity.

The banks are also angry that a claim of pounds 6m from Birdcage Walk, a Walker family company now in liquidation, was disallowed despite a sworn affidavit by Mr Walker saying that he owed the money.

At the meeting Mr Walker said he was not sure that the pounds 6m claim was correct, and was accused of perjury. It is understood that the liquidator of Birdcage wished to vote against the agreement.

The banks raised another objection at the meeting. In his affidavit Mr Walker said that under an individual voluntary agreement, an estimated pounds 14.5m would be made available to creditors from a Netherlands Antilles company called Richards BV.

The money has become available because Richards has been assigned a claim against Brent Walker by Holt Freres, a French company whose president is Mr Walker, to do with a sale of businesses by a Holt subsidiary, Jasaro SA.

Lawyers for the banks said that at a meeting on 27 November 1990, Mr Walker signed a guarantee with Standard Chartered and four other banks that he would not dispose of any significant assets from Jasaro without the consent of the banks.

The banks said that the transfer to Richards is in breach of this undertaking. Mr Walker disputed this, saying the transfer was covered by French law, under which the guarantee was not valid.

Mr Hocking was unavailable for comment about the conduct of the meeting and the vote.

The banks have one month to make challenges to the vote.

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