A Chinese bank allegedly sold a Canadian real estate firm to a bank in the United States, with the firm’s lawyers saying it was “staggering” to think a Chinese investment bank might be in the business.
In a complaint filed last month with the US Securities and Exchange Commission, the firm alleges that Inglourious Boulangerie du Lac (IBL) sold the real estate company to the China Investment Corporation (CIC) on behalf of the bank in a “sales pitch” that was “likely fraudulent and unlawful”.IBL’s lawsuit says the CIC “was aware of the misrepresentations and misrepresentations made by Ingloumis Boulangers”.
The bank’s complaint says the bank “intentionally misled” investors by “misrepresenting the size of the potential equity market opportunity” and the size and market value of the company.
The real estate law firm, which is based in Ottawa, alleges that in March 2016, the C&A Group, a Chinese-owned investment company, offered IBL $100 million in a stock offering.
The C&As complaint alleges that IBL was offered $75 million in cash, but “did not consider the value of this offer at the time.”
The firm claims the cash was “discussed with and approved by IBL’s board of directors” but that the board “never accepted this offer”.IBG alleges that the bank’s board “made false representations to IBL in a letter dated February 27, 2017”, when the bank asked for a $30 million cash offer.
The letter, dated February 24, 2017, reads: “We are now in the process of completing our transaction and looking to sell the IBL portfolio in the US.
We believe that the C &A Group offers a superior portfolio with superior returns.
The company is in the top ten in the S&P 500 and in the bottom three in the FTSE 100.
We have also secured a commitment to provide a large capital infusion of $30m.
The letter is signed by Peter Liu, president of the firm.IBG says that it had “no role” in negotiating the offer and that it did not “advise, consent or participate in any transaction”.”
In addition, IBG’s own investigation has not found any wrongdoing by the company or its management.””
The C & A Group has no business with IBL, no business of any sort with IBG, and has not been a client of IBG.
In addition, IBG’s own investigation has not found any wrongdoing by the company or its management.”
The company also alleges that while it was in talks with IBM for a sale of its portfolio, the bank informed the company that the sale was being made on behalf “of CIC”.IBM says it was only informed that the deal had been finalized by the Cic bank, not by the bank.
The bank says it is aware of IBL and its business in the real property sector and has taken steps to address any issues in that industry, but that it has no control over the C,A or C & C portfolio.IBL said in a statement: “IBL was not involved in the transaction and does not have a financial interest in the C or C&C portfolio.”
