Hedge fund manager’s divorce may be Britain’s biggest ever

Divorce|June 19th 2014

An upcoming divorce between hedge fund manager Chris Hohn and estranged wife Jamie may lead to Britain’s biggest ever financial settlement.

Surrey-born Mr Hohn, now 47, met his American wife while studying at Harvard Business School and they went on to have four children together, including triplets. After achieving success as an investment banker, Mr Hohn became a leading philanthropist.

The couple began divorce proceedings last October and are now in dispute regarding the value of key assets.

At a hearing this week, the Court of Appeal was told that the couple’s fortune includes a hefty £680 million worth of investments in the highly successful Children’s Investment Fund (TCI), which was established by Mr Hohn in 2003. According to a report in The Telegraph, they also have pensions with a value of £50 million, £21 million worth of properties, £17 million in unspecified additional investments, and a number of subsidiary companies.

He claims these subsidiary firms are worth around £64.3 million while Mrs Cooper-Hohn insists they are worth more, perhaps as much as £470 million. She sought to present valuation evidence supplied by accountancy and financial firm EY at the couple’s imminent divorce hearing. But, sitting at the Court of Appeal yesterday, Lord Justice Ryder said the EY report would be hypothetical and not relevant to the proceedings.

Their divorce hearing is scheduled for June 30. Mrs Cooper-Hohn is seeking 50 per cent of the couple’s assets, while Mr Hohn argues she should get only 25 per cent because he made a “special contribution” to their considerable wealth, which is thought to comfortably exceed £1 billion.

Here we have the classic ‘big money divorce’. Mr Hohn is clearly a very talented investor – one of the most successful in the world, the Telegraph says – so his claim to have made a “special contribution” to the couple’s assets may have some merit. On the other hand, his estranged wife bore him four children and played a major role in his high profile philanthropic efforts. It is clearly right that her contributions to the couple’s life should be fairly acknowledged.

Once the fundamental financial needs of each party in a divorce have been met, any remaining assets – and there are clearly plenty here – will, as a general rule, be divided equally. But the courts will at times recognise outstanding or ‘stellar’ contributions with a higher share.

One example of such unequal division familiar to every family lawyer is the 2005 divorce of Sir Martin Sorrell, the chief executive of advertising agency WPP, who was granted 60 per cent of the matrimonial assets when he divorced his first wife Sandra . And in the 2007 case Charman vs Charman, the husband exited a 30 year-marriage with 62 per cent of the couple’s assets.

But such situations are the exception rather than the rule. We will have to wait and see what decisions the court comes to when the Hohn divorce is heard. Is the 25 per cent award sought by her husband fair, or is she entitled to the full 50 per cent? Whatever happens, she will certainly walk away from the marriage a very wealthy woman but as we frequently see on divorce, contributions viewed retrospectively may not always be valued the same as they were at the time!

Photo by s_falkow under a Creative Commons licence

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  1. Andrew says:

    A Calderbank regime might have worked wonders for these people.

  2. 15 Family law facts: Did you know…? - Marilyn Stowe Blog says:

    […] 3. The largest divorce on UK record was for £48 million, between John and Beverly Charman (although that could soon change). […]

  3. Media allowed to report Hohn divorce - Marilyn Stowe Blog says:

    […] Christopher Hohn had tried to impose a ban on media coverage of his pending divorce from wife Jamie. While divorces in England are typically heard in private, details of the Hohns’ separation were discussed in a Court of Appeal ruling last month. […]

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    […] Marilyn Stowe explained here last month, the upcoming divorce between hedge fund manager Chris Hohn and his estranged wife Jamie […]

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