JP Morgan in English legal battle with its European joint venture Viva Wallet
US banking giant JP Morgan and the majority owner of Greek payments firm Viva Wallet are battling each other at an English court this week over the valuation of its joint venture.
JP Morgan acquired a 48.5 per cent stake in the Athens-based payments fintech Viva Wallet, in 2022 for $800m (£637.2m). The unicorn fintech was valued at more than $2bn (£1.5b) at the time of the deal.
WeRealize is named on the legal documents of the lawsuit. Viva Wallet is the fintech that JP Morgan acquired a stake in, while WeRealize is the holding company.
Speaking at the time of the deal, the bank’s global payments Takis Georgakopoulos described it as a strategic investment to support the bank’s vision of new growth and payments innovation targeted at European small and midsize businesses.
However, earlier this year the US banking giant issued legal action against the holding company in the English High Court, but on the same day, WeRealize filed a lawsuit back against the bank.
The core dispute concerns the interpretation of a call option process under a shareholders’ agreement, which gives JP Morgan the right to buy fintech shareholding in Viva. Under the terms of the shareholder agreement, the US bank states that it has the rights to exercise this call-option at whatever fair market value as determined by independent valuation experts.
The parties also have several other disagreements, such as the correct approach to valuation, including the relevance of certain US banking regulations (known as Regulation K).
As the dispute is time-critical, it was rushed in for an expedited trial just shy of three months after the claims were launched.
The parties started at the Commercial Court on Monday in front of Dame Clare Moulder, and the trial is expected to last up to five days.
JP Morgan called on partners Christopher Robinson and Thomas Clark of magic circle firm Freshfields. The partners instructed a team of barristers from Fountain Court Chambers, Richard Handyside KC, Rosalind Phelps KC, Rupert Allen, Christopher Langley and Gillian Hughes.
However, the Greek fintech has called on Quinn Emanuel’s senior partner in its London office, Richard East. He has instructed a range of barristers including Richard Lissack KC and Charles Redmond (of Fountain Court Chambers), Robert Weekes KC and Timothy Lau (of Blackstone Chambers) and Andrew Thornton KC and Ben Griffiths (of Erskine Chambers.
A spokesperson for JP Morgan said: “We recently opened our case against WeRealize.com Ltd., the majority shareholder in Viva Wallet. This claim is necessary due to actions taken by WeRealize to limit or circumvent our contractual and legal rights as an investor in Viva.”
“We are pursuing these legal remedies having exhausted all other options. Despite this dispute, we believe in Viva Wallet, its people, our strategic investment in the company and our wider business in Greece,” they added.
WeRealize declined to comment.