Lloyds Snubs Goldman Offer For Buyout Arm
The private equity arm of Lloyds Banking Group has snubbed a secret takeover offer for part of its business from Goldman Sachs, prompting the departure of one of its top executives.
Sky News has learnt that a division of Goldman, the Wall Street giant, recently proposed buying the London operation of Lloyds Development Capital (LDC), which owns stakes in companies including Uswitch, the price comparison website, and Fever Tree, a soft drinks producer.
Sources said on Friday that Goldman had been keen to take over some of LDC's investments as well as some senior executives, including Daniel Sasaki, the firm's London managing director.
The approach is said to have exposed tensions between Mr Sasaki and colleagues in LDC's network of regional offices.
LDC rejected Goldman's interest, and Mr Sasaki is understood to have left in its immediate aftermath.
Mr Sasaki had been dismissed after LDC alleged that he had been guilty of "a breakdown of confidence and trust", according to a person familiar with a letter sent to him.
Mr Sasaki's spokesman denied that suggestion.
Lloyds' continued involvement in the private equity business through LDC has at times been controversial since its taxpayer bailout in 2009.
Some rivals have alleged that LDC has been able to enrich senior executives by investing in companies with an unfair advantage of financial support from the Government.
Lloyds is now 25%-owned by the Government following two stake sales during the last year.
A spokesman for Mr Sasaki said he had acted properly at all times.
"(His) success generated external interest in the London part of the business which in turn led to [his] departure," he said. "Daniel Sasaki... behaved with utmost propriety at all times and there is no dispute regarding his departure.
"(Mr) Sasaki is now reviewing all options open to him and has already been approached by competitors of LDC London to replicate the success he achieved within LDC."
There is no ongoing legal dispute between Mr Sasaki and LDC, a source said, while Goldman is not pursuing its interest in the business.
A spokesman for Lloyds said it would not comment on individual employees but denied that it had any interest in offloading LDC.
"LDC is a core part of Lloyds Banking Group's support for SME and mid-market companies and it has a consistent track record of private equity investments in UK SMEs and the mid-market, having invested more than £1.5bn over the last five years to support ambitious businesses' growth," he said.
The Lloyds private equity unit, which also backs companies such as the retailer Joules and Imagine Nation, a media content producer, was one of Europe's most prolific investors last year, investing in 26 businesses.
Darryl Eales, LDC's chief executive, resigned before the Goldman approach, sources said.
Mr Eales has since been replaced by two executives from LDC's Birmingham office, which led Mr Sasaki to conclude that a buyout of the London operation could be in the interests of the firm, a source close to Mr Sasaki said.
Goldman Sachs declined to comment.