Tycoon’s £5m bill for expenses at Grade’s failing theatre firm
A THEATRE company chaired by Conservative peer Lord Grade was put into administration yesterday after a court heard how a Hong Kong tycoon with links to the Royal Family ran up an expense account totalling almost £5million.
Businessman Dr Johnny Hon invoiced the ‘simply extraordinary’ sum of £4.7million to Gate Ventures, now chaired by Lord Grade, when he acted as chairman before the former BBC boss took over in December 2017.
Gate Ventures has invested in West End shows including Sunset Boulevard and 42nd Street, as well as a string of obscure films in the Far East. The Duchess of York was a director of the company before stepping down in December.
The High Court in London heard that Gate Ventures was in ‘complete disarray’ and had lost £19million out of £24million invested. This had mostly come from 3,500 Chinese investors who had been wowed by the presence of the duchess and Grade at glitzy roadshows in the Far East, where they ‘played to packed audiences’.
Quentin Zheng, a Chinese businessman, launched an application to place the company into administration on the basis that he was unable to recoup a £2.5million loan.
In response, Lord Grade said Gate Ventures had fallen victim to a ‘serious fraud’ committed by Mr Zheng, who had promised investment of £7.5million following the Far East roadshows, which has never materialised.
The former ITV executive chairman then dramatically accused the tycoon of ‘organising and leading pyramid selling activities’ in China.
However, after three days of evidence Judge Sebastian Prentis took control of Gate’s assets out of the directors’ hands and placed the company into administration after divulging details of Dr Hon’s spending.
The court heard that Dr Hon, who has paid the Queen’s grandchildren Peter and Zara Phillips as well as the duchess to work for his firms, charged Gate Ventures around £2.9million for meetings with celebrities.
Judge Prentis said: ‘Dr Hon has been billing himself as a man of influence through the use of company money. That is not the purpose for which these small Chinese investors paid their money in to the company.’
He cited a £6,500 bill for lunch with fashion designer Tommy Hilfiger, thousands for lunch with Prince Albert of Monaco, £12,293 for a meeting with Manchester United’s Paul Pogba and a £4,000 piano lesson.
Judge Prentis said that an hour’s ‘training session’ with a Victoria’s Secret model in New York might have been ‘a very invigorating occasion for everybody’, but it was not ‘immediately recognisable as company business’. During his tenure, Dr Hon also charged Gate Ventures for meetings with Hollywood icons Robert De Niro, Al Pacino and Julia Roberts.
In a last-ditch bid to save the firm, Lord Grade said he was hoping for a £7.5million investment from a ‘substantially high net-worth individual’.
But rejecting his pleas, Judge Prentis said that the ‘administration route seems the most preferable one’. Gate Ventures could now be forced to sell all of its remaining assets.