Uday Mehra, a former regional director at L Capital Asia, filed documents this week denying allegations that insubordination and misconduct cost him his job, reiterating his claim that he was fired after revealing mismanagement at the firm. L Capital Asia, the Asian private equity arm of French luxury group LVMH, has more than $1.5 billion in assets under management.
Mehra sued L Capital Asia in March this year following his exit from the firm in June 2015. Mehra alleges that the firm dismissed him after he revealed wrongdoings related to L Capital Asia’s business investments, saying his employers conspired against him to “stifle his whistleblowing activities”.
Mehra says that between 2012 and 2015 he raised concerns to L Capital Asia’s management over a number of questionable transactions. These included significantly raising profit projections for an investment target, refinancing a struggling portfolio company “despite advice from his investment team”, and rushing an acquisition “without conducting the full range of due diligence.”
Mehra also claims he is entitled to $37.5 million or 2.5 percent carried interest from the firm’s second fund, L Capital Asia II, which he would have received had he not been fired. In court papers, he said he was promised tenure of 10 years at the firm.
L Capital Asia denied any wrongdoing and said in its defence in May that Mehra is not contractually entitled to the amount he claims. The firm denied that Mehra’s alleged whistleblowing had anything to do with his termination, claiming instead that he was terminated for misconduct and insubordination. The firm also said that Mehra’s allegation of a conspiracy is “unsupported and baseless.”
L Capital Asia is represented by WongPartnership LLC. In response to an emailed query from Private Equity International, the law firm said of Mehra’s lawsuit: “L Capital considers these allegations to be baseless and intends to vigorously resist his claim in the Singapore Courts to the fullest extent.”
According to L Capital Asia's court papers, Mehra’s concerns were independently reviewed and investigated by LVMH and no wrongdoing was found.
Mehra joined L Capital in May 2012 as a regional managing director for operations based in India. He was also a member of the investment committee and a “key man” for the fund, Mehra wrote in his LinkedIn account. Early in his career, he was vice president for Asia-Pacific at Tommy Hilfiger and a business director at Nike.
Mehra’s case is just one of a number of legal hurdles faced by L Capital Asia. The firm is still in a legal dispute with Chris Au, a co-founder of Singapore rooftop bar Ku De Ta, who alleged in 2014 that L Capital and other business partners were “conspiring to steal his rightful share of the club.” The lawsuit also involves other shareholders of Ku De Ta, now renamed Ce La Vi, who are disputing the splitting of sales proceeds.
L Capital Asia is also involved in another legal tussle with John Manos, a shareholder of one the firm’s portfolio companies, Jones the Grocer. Manos took L Capital to court earlier this year, claiming the firm had excluded him from management of the company and its subsidiaries and abused its voting powers.
L Capital Asia invests in lifestyle products and services companies with an enterprise value of between $100 million to $1 billion.
Uday Mehra is represented by RHTLaw Taylor Wessing LLP. Mehra and his lawyers did not provide further information on the case.