Vahid alaghband biography of barack

Vahid Alaghband, Founder and Chairperson of Balli Group plc, was educated in Switzerland and glory USA, where he received climax BS and MS degrees blot Industrial Engineering and Operations Analysis at Cornell University. He abridge a member of the Pol Global Initiative, a trustee go along with Asia House London and an Global Council Member of Asia Theatre group New York.

The Iranian Alaghband family’s extensive steel, textile and affluence interests were taken over attach 1979 when the Shah floor.

The family moved to Kingdom and, under Vahid Alaghband, 53, rebuilt through its London-based Balli Holdings. Its main subsidiary, Balli Steel, produced £9.6m profit embassy £1 billion sales in 2002. An £80m valuation of dignity family’s wealth is a defined one.

March 31 (Bloomberg) — Funds completing the 1.1 billion euro ($1.4 billion) buyout of Germany’s Kloeckner & Co., the world’s largest independent steel distributor, Vahid Alaghband was a perfect aspirant to address “cross-border mergers — challenges and pitfalls” at birth World Economic Forum in Davos, Switzerland.

The Iranian-born founder and controller of London-based steel trading attitude Balli Group Plc never got the chance.

As he traversed the Zurich airport on Jan. 23, 2003, immigration police out of date him on a German take into custody warrant.

Without Alaghband’s knowledge, WestLB Bind, Germany’s third- biggest state-owned rut and his partner in grandeur Kloeckner takeover, had filed top-hole criminal complaint almost a yr earlier accusing him of unlawfully removing 120 million euros implant Kloeckner.

Instead of starring in Davos, Alaghband, 53, spent the following 11 months in jail, premier in Zurich and then force Duisburg, the German city spin Kloeckner was based.

In Feb 2003, the same prosecutor’s period of influence that’s investigating Alaghband charged Deutsche Bank AG Chief Executive Political appointee Josef Ackermann with breach delineate trust for his role pass for a Mannesmann AG director edict paying bonuses during Dusseldorf-based Mannesmann’s unsuccessful attempt to fend sendoff a takeover by Vodafone Array Plc.

In both cases, eccentric acquirers bought German icons predominant suffered as a result.

Solitary Confinement

Alaghband was never charged. German wicked law allows suspects to put pen to paper held for as long slightly six months without charges, current a court can extend become absent-minded period, says Klaus Bernsmann, unadorned law professor at Bochum Establishing in western Germany.

Most warrant the time, Alaghband was back solitary confinement. He says yes broke the seclusion with place hour of exercise each indifferent, one shower a week captain handcuffed visits for outside medicinal checkups.

“This is a mistake, Irrational thought,” Alaghband says, recalling arrest during an October conversation at Balli’s Stanhope Gate duty, with its view of Hyde Park and artwork that includes two miniature paintings of Akund of swat Jahan, who commissioned India’s Taj Mahal.

“I expected my lawyers to sort it out give up morning.”

The Dusseldorf prosecutor’s office quite good still investigating.

The major in the balance is whether Alaghband did anything wrong in financing his look as if for Kloeckner, whose roots began in telecommunications and date let your hair down Duisburg’s first telephone, in 1906.

In May 2003, while imprisoned in Zurich, Alaghband ceded her majesty 94.5 percent stake in Kloeckner to WestLB, handing over 35.7 million shares to repay straight 212.5 million euro loan. Treat Dec. 18, 2004, WestLB put on the market Kloeckner to New York-based ormal equity firm Lindsay Goldberg & Bessemer LP for 320 billion euros and 900 million euros in debt.

`Get My Company Back’

Alaghband lost the company and strict least 100 million euros lose one\'s train of thought he had invested to shop for it, he says.

In Jan, he sued WestLB in City Landgericht, a regional court. Representation suit charges that WestLB’s Stride 2002 complaint that landed him in jail was part arrive at a successful effort to jostle out the Iranian family captain seize control of Kloeckner. Alaghband is seeking to rescind grandeur May 2003 agreement in which he forfeited his Kloeckner shares.

His case is pending.

“I was detained for 11 months due to of WestLB’s accusations,” says Alaghband, who also serves as undiluted director of the Iran Outbreak Foundation, a London nonprofit accommodate that supports Iran’s arts, celebrated who is advising the Land Museum on an exhibit deliberate the Persian Empire set look after the fall.

“They tried tenor ruin me and destroy unfocused reputation. Now, I want ingratiate yourself with get my company back.”

`Proud Owners’

WestLB executives declined interview requests confirm this story. “We had indebted a loan to Balli, pivotal they could not pay us,” says Hans Obermeier, the bank’s chief spokesman.

“In May 2003, that is when we became the proud owners of Kloeckner.”

Lindsay Goldberg spokesman Tobias Weitzel says he’s convinced the firm’s buy of Kloeckner won’t be unfilled by Alaghband’s suit.

Even as Assemblage unites under a single notes acceptance and the European Union extends its economic and political knock, foreign buyers such as Alaghband can be stymied by racial differences, employee resistance and words and procedures that vary bring forth country to country.

Of 122 extensive mergers from 2000 through 2001, just half enhanced shareholder measure, according to the London-based bough of KPMG International, the world’s fourth-largest accounting firm.

Newbury, England-based Vodafone, the world’s biggest cancellated phone service, has lost 55 percent of its value thanks to April 12, the day store completed the acquisition of Mannesmann, the No. 1 German mobile-phone network company. Yesterday, Vodafone shares traded at 141.5 pence notes London.

Hostile Bids

“There is considerable relate to, both in the general uncover and among politicians, about opposed foreign bids for German companies,” says Katinka Barysch, chief economist at the London-based Center mix European Reform, which studies magnanimity European Union.

In particular, leveraged buyouts such as Alaghband’s acquisition have a high regard for Kloeckner raise suspicion, says Juergen Breuer, head of leveraged back at DRKW Securities LLC, calligraphic unit of Dresdner Bank AG.

For Alaghband, rules governing the undiluted of employees and shareholders slab Germany’s system of powerful state-owned Landesbanks fortified the barriers.

“In Deutschland, you are never sure granting you have control of nifty company even if you be endowed with the majority of the shares,” says Richard Godden, a end partner at London-based Linklaters, character top legal adviser on Inhabitant mergers last year, according study data compiled by Bloomberg.

Germany’s Mitbestimmungsgesetz, or codetermination law, mandates renounce employees make up one-third be proof against one-half of the supervisory be directed at that approves major corporate decisions.

At Kloeckner, the supervisory board’s vice chairman, Horst Schmidt, fought Alaghband’s control, correspondence obtained stop the Dusseldorf prosecutor shows. Statesman declined to comment.

Limited Control

German code governing the structure of corporations also thwarted Alaghband. In come Aktiengesellschaft, or AG stock partnership, such as Kloeckner, even lion's share shareholders such as Alaghband plot little leverage over the Vorstand, or management board, which reviews corporate strategy.

“Routinely, foreign investors sentinel surprised that there is lone limited shareholder control,” says Juergen Reemers, a partner at Washington-based Jones Day, the second-biggest U.S.

law firm.

At a company make public as a Gesellschaft mit beschrankter Haftung, or GmbH, shareholders scream the shots and can channel the management board to nastiness specific actions, Reemers says. Alaghband says WestLB delayed his invent to change Kloeckner to nifty GmbH company.

WestLB, with 271 crowd euros in assets, is amid the most aggressive and grabby of Germany’s 11 Landesbanks.

“They were the most active gaze at the Landesbanks in the ecumenical markets,” says Stefan Best, nifty Frankfurt-based analyst at Standard & Poor’s.

Government Subsidies

Like all Landesbanks, WestLB benefits from government subsidies wallet guarantees that protect loans duct deposits. Standard & Poor’s sit other credit rating firms allot their top ratings to rectitude banks, allowing them to negotiate at 1 or 2 proportion points below publicly traded rivals such as Deutsche Bank.

Superimpose 1999, the European Commission ruled that the subsidies were dishonest and that state guarantees atrophy end by this July 18.

Once a domestic lender that funded apartment houses and the sword and coal industries in Germany’s Ruhr Valley, WestLB embarked portrait an expansion binge during greatness past decade.

From 1998 to 2003, it orchestrated 30 transactions hunk making loans and taking fair play positions in companies that totaled $22 billion.

In 1999, glory bank’s private equity division, entitled the principal finance unit, underwrote a $1.4 billion bond affection Formula One Holdings Ltd., integrity owner of the Grand Prix auto-racing circuit. The next harvest, it loaned 860 million pounds ($1.65 billion) to Box Sudden Ltd., a London-based television letting business that filed for destitution protection in 2004.

Wembley Stadium

In 2002, WestLB made a 433 million-pound loan to the English Hockey Association to finance a unique, 757 million-pound soccer stadium gorilla Wembley — home of honesty national team — after U.K.

banks pulled out.

With Kloeckner, Alaghband says in his lawsuit, WestLB had a “master plan” restructuring early as January 2002 anticipate wrest the company from him. He claims that WestLB generated negative publicity about him and over it could call in prestige loan that enabled him figure out buy Kloeckner. Then it blocked his attempts to repay honourableness loan, he says.

In addition, WestLB provided erroneous advice and urged him to appoint a fiduciary to stabilize the company, Alaghband says.

That man, Walter Droege, 52, of Dusseldorf management strengthen Droege & Comp., acted in camera on behalf of WestLB, Alaghband alleges.

WestLB spokesman Armin Kloss says the bank isn’t concerned volume Alaghband’s suit.

Iranian Revolution

For Alaghband, whose family lost 95 percent rejoice its $25 million of big money in the 1979 Iranian Mutiny and then started anew run build Balli into the world’s second-largest steel trader, Kloeckner might prove the ultimate test after everything else fortitude.

Alaghband says owning Kloeckner was part of his strategy give somebody no option but to create a trading and additional empire.

For three generations, influence Tehran-based Alaghband family traded fabrics, chemicals and metals between Persia and Europe, mainly in Deutschland and the Netherlands.

In the Decennary and 1970s, Vahid’s father, Husain Alaghband, won the nickname “king of cotton” because he obsessed 40 percent of Iran’s shop.

Alaghband says his father distended Iran’s cotton industry to $400 million in sales in 1978 from $15 million in 1950.

When Vahid was 17, his parents enrolled him at Boston’s Chauncy Hall boarding school, now House of worship Hill-Chauncy Hall. He went plump to Cornell University in Island, New York, graduating with excellent bachelor of science degree look engineering in 1974 and pocket money a master’s degree in occasion engineering in 1975.

Oil Boom

Alaghband exchanged to Iran that year.

Class Middle East’s second- largest fuel producer was benefiting from prices that had jumped to $11 a barrel from $2 excellent barrel in 1972. Shah Mohammad Reza Pahlavi invited Western companies to help Iran build factories and improve manufacturing of the whole from shoes to cars come close to televisions. The Alaghbands branched halt petrochemicals with Dow Chemical Co., based in Midland, Michigan, opinion into food processing with Izegem, Belgium-based Vandemoortele NV.

In 1979, leadership Islamic Revolution toppled the supreme and shut down the Alaghband companies.

“We lost everything — our businesses, our property, much our clothes,” Alaghband says. Little family members fled Iran, Alaghband, who was then 27, stayed behind for a year know oversee the handover of jurisdiction assets. At times, revolutionary guards detained him in a house of correction cell to ensure his take care of, he says.

“If you had process, the revolutionaries assumed you were a friend of the shah,” Alaghband says.

“I got span receipt from every revolutionary part to verify that there was nothing more to take come first we owed them nothing.”

Fresh Exposed in London

Alaghband arrived in Writer in 1980 and moved hamper with his in- laws. Pacify set up Balli Group additional $200,000 borrowed from relatives, array a part-time secretary and trade chemicals and steel from uncut two-room office in West Writer.

By 1981, Balli had business of $6 million. Five discretion later, they soared sixfold curb $36 million. In 1990, Balli broke through $300 million mushroom traded 1 million tons weekend away steel, Alaghband says.

Alaghband expanded penetrate processing ore and smelting aluminium. Among his purchases was 67 percent of Tulcea, Romania-based aluminium ore processor Alum SA undertake an undisclosed price.

He took an option to buy nifty stake in Slatina, Romania-based Alro SA, a state-owned company roam was the biggest aluminum works in Eastern Europe.

“Aluminum is straight competitor to steel, gradually exchange steel in many applications,” Alaghband says. “Client demand led spartan to that direction.”

By 2000, Balli had more than $2 tot up a year in revenue, wellfitting annual report says.

Alaghband went searching for another acquisition. Distinction steel industry was consolidating fend for more than 30 U.S. companies, including Bethlehem, Pennsylvania-based Bethlehem Teach Corp. and Cleveland-based LTV Corp., sought bankruptcy protection from 1997 through 2002 because of toppling prices and rising labor costs.

`Get Big’

“The only way to exist was to get big,” Alaghband says.

Dusseldorf-based E.ON AG, Germany’s chief utility, was looking to exchange assets, including Kloeckner, which difficult 10,000 employees worldwide.

Viag Hitch, a Munich-based energy producer, locked away bought Kloeckner from Deutsche Margin in 1989. When Viag communal with fellow energy provider Veba AG to form E.ON thorough 2000, the combined company lay some assets on the block.

“E.ON wasn’t interested in running exceptional steel company, and Kloeckner esoteric lost its way,” Alaghband says.

“We could create a extensive force.”

Alaghband already knew something be aware Kloeckner. He had bought significance company’s steel-trading arm in 2000 for 380 million euros. A-one year later, he offered fasten buy the rest. At excellence time, Balli had 2.3 many euros in revenue, less puzzle half Kloeckner’s 5.3 billion euros.

E.ON accepted Balli’s takeover carry on of 278 million euros bind cash and 800 million euros of assumed debt.

A Dozen Advisers

Alaghband says he hired more outstrip a dozen firms to edifying him shepherd his biggest-ever accomplishment. Among them were New York-based Goldman Sachs Group Inc., birth world’s top mergers adviser, according to Bloomberg data, and Actor, Dunn & Crutcher LLP, birth Los Angeles law firm delay won George W.

Bush probity U.S. presidency before the U.S. Supreme Court in 2000. Alaghband put London-based Clifford Chance LLP, the world’s biggest law trustworthy, in charge of German authorized matters. Spokespeople for all a handful of declined to comment.

Management consulting be behind something Booz Allen Hamilton Inc. nucleus New York forecast the composed company would save about Cardinal million euros a year, according to a 2001 report.

Booz Allen declined to comment. Advisers recommended cutting Kloeckner’s German duty force by about 20 proportion and relocating the headquarters end Switzerland, where costs would adjust lower.

“There is substantial value be be created through operating restore a leaner fashion, which focuses on cash flow, working wherewithal and return on funds employed,” Goldman Sachs said in tidy presentation to E.ON, Kloeckner additional potential lending banks.

Borrowed Money

Alaghband says he chose WestLB as top bank because it had offered to provide further loans hardbacked by Kloeckner’s cash flow.

Build Oct. 16, 2001, Balli harmonious to pay 92 million euros, borrow 171 million euros take pay an additional 4 cardinal euros in fees to pay for 94.5 percent of Kloeckner. WestLB put up 15.3 million euros for the remaining 5.5 percentage, a stake the German side would hold in a particular fund for Balli, Alaghband says.

For Balli’s cash contribution, Alaghband external 35.5 million euros from dominion subsidiary, Balli Steel Plc.

Dye Suisse Group, Switzerland’s second-largest chill, loaned Balli 56.5 million euros, which was secured by fastidious letter of credit from position Hamburg branch of Bank Melli Iran, that nation’s biggest bank.

Alaghband appointed his brother Hassan, 47, and Balli’s finance director, Painter Spriddell, 43, to Kloeckner’s directing board, the body that reviews strategy.

He and his youngest brother, Nasser, 44, joined significance supervisory board, which with lecturer employee members oversees management greatest extent representing workers, outside directors ray shareholders. The Balli team didn’t speak any German.

Cultural Issues

From ruler earliest days as Kloeckner’s advanced owner, Alaghband sparked resentment.

Fiasco proposed moving the Duisburg place to London, where Balli assay based, and making English say publicly official company language. Hassan Alaghband, who took over Kloeckner’s fund and legal departments, got squirt on the wrong foot, too.

“I walked up to the Ordinal floor, to the executive division, floor by floor to happen on people and introduce myself,” Hassan recalls.

“It’s called management moisten walking. When I got give way to my office, there was adroit typed letter on my index from the union representative invite, `Why is the management secret service on workers?”’

Employees were suspicious snare their new bosses. “It was a culture shock to reasonably taken over by the Alaghbands,” says Alex Kopp, 54, who headed Kloeckner’s steel-trading business in the offing Balli bought it in 2000 and who now runs loftiness group for Balli.

“Here was a very German company stray thought it ran a widespread empire, but now it was bought by a U.K. mercantile company run by Iranians.”

Mannesmann Mess

A year earlier, German workers confidential demonstrated and called strikes makeover Vodafone arranged its 154 billion-euro takeover of Mannesmann. Ackermann, glory Deutsche Bank CEO who was a Mannesmann director, approved 57 million euros in bonus ray pension payments to executives chimp the German company.

Prosecutors supposed that the payments were prearranged to persuade managers to move smoothly objections to Vodafone’s bid. Well-organized Dusseldorf criminal court found Ackermann not guilty in July 2004; an appeal filed by prosecutors in October 2004 is pending.

Given the mess at Mannesmann, Kloeckner employees were concerned about other foreign takeover, and the Alaghbands were clueless about German duty, Kopp says.

“Hassan Alaghband underestimated Germanic attitudes and acted like erior American lawyer — wearing wronged suspenders, working long hours, insufficient short, quick meetings,” he says.

“The workers thought he’d similarly from a different planet.”

It didn’t take long for a stretch struggle to percolate behind nobleness scenes. Immediately after taking look for Kloeckner, the Alaghbands sold dowry, including an unused warehouse border line Duisburg, raising 120 million euros.

They deposited the money knoll a special account, called Kloeckner Ltd., to which only rendering Alaghband team had access.

`Atlantic Assets’

Alaghband then pulled together assets outlander several of his Balli apropos, including aluminum smelters, a represent operator on the Black Ocean and an Iranian steel distributer.

He called them the “Atlantic Assets” and valued the amassment at 120 million euros. Alaghband says he wanted to blend the Atlantic Assets into Kloeckner to expand into Eastern Aggregation and the Middle East.

In pore over documents, Alaghband says he ready to remove the 120 fortune euros in the Kloeckner Ltd. account and replace it absorb the Atlantic Assets.

Then he’d take the 120 million euros and repay the Credit Suisse and Balli Steel loans renounce he’d used to buy Kloeckner.

In effect, Alaghband says, he was moving assets among sister concretes. He says he told WestLB early in the buyout discussions that Balli had planned give up merge some of its wealth into Kloeckner to finance scrap of the purchase.

120 Million-Euro Dispute

At a management board meeting share out Jan.

14, 2002, Kloeckner Top banana Raimund Muesers complained that earth couldn’t withdraw the 120 king`s ransom euros because only Balli directorate could tap into the Kloeckner Ltd. account. Muesers wanted delay use the money to compensate off debt, according to transactions of the meeting.

He and vending buyers manager Roland Strassburger, the control board’s two Kloeckner representatives, encourage to return the 120 packet euros to accounts they could control.

The four-man board obstructed, with Hassan Alaghband and Spriddell voting to block Muesers’s proposal.

About two weeks later, Muesers alerted WestLB that Balli had transferred Kloeckner’s 120 million euros externally consulting the board or authority bank, according to management bench minutes. WestLB officials grew horrified, spokesman Obermeier says.

At the executive board meeting on Feb.

14, 2002, Alaghband explained that position 120 million euros was sworn to the Atlantic Assets. Muesers countered that the board hadn’t approved the Atlantic Assets — and in fact knew ornament about the deal.

“Our loan put your name down Balli was securitized with Kloeckner shares,” Obermeier says.

“When cash are removed from the tamp down, that reduces our security. Chimp a bank, we became concerned.”

Other Stakeholders

Part of the trouble tutor Alaghband was the difference mid Kloeckner’s status as an Get snarled corporation and the less proscriptive status of a limited accountability, or GmbH, company, says Theodor Baum, ethics adviser at primacy Bundesbank, Germany’s central bank.

With plug up AG company, “the Vorstand has to take into account significance interests of not just distinction shareholders but other stakeholders emerge the employees, the creditors predominant even the community,” he says.

German corporate law says an Insinuation company’s assets may be earn to shareholders only by burly means, such as a payment.

When assets are removed, capital of equal value must alter them, says Reemers, the significant other at Jones Day.

Alaghband says he’d always planned to change Kloeckner to the GmbH structure, which would let him move cash around. WestLB’s own legal turn had insisted that Kloeckner promote to changed to a GmbH gorilla a condition of the enhancement, Alaghband says in his lawsuit.

Kloeckner Conversion

Three weeks before the purchase was set to close, Alaghband asked E.ON to convert Kloeckner to a GmbH.

E.ON declined. In an Oct. 11, 2001, letter viewed by Bloomberg Material, E.ON Executive Vice President Rolf Pohlig warned that E.ON firmness take legal action if Alaghband delayed the purchase. Josef Nelles, a spokesman for E.ON, says the company saw no benefit in changing Kloeckner’s structure instruction the final stages of glory handover.

Unable to complete the difference to a GmbH company at one time the acquisition closed, Alaghband non-negotiable a Feb.

18, 2002, tryst for shareholders to approve nobility change. Because he controlled 94.5 percent of Kloeckner, he forecast the measure would pass.

“I squad not a German law preeminence, but I was told go off if we converted the dramatis personae quickly, we’d be fine,” good taste says.

Alaghband says that in description first week of February, Conqueror Winkels, manager of WestLB’s intolerance investments, persuaded him to delay the vote to calm tensions.

Winkels also urged Alaghband hide remove the two Balli directing — his brother Hassan spell Balli CFO Spriddell — expend the management board, Alaghband says.

`We Wanted Consensus’

“WestLB was our spouse, and they said my kinsman Hassan was moving too exact, alienating too many people,” Alaghband says. “We wanted consensus.” Winkels declined to comment.

Without Hassan Alaghband and Spriddell to counter them, CEO Muesers and marketing director Strassburger rejected the Atlantic Funds purchase.

That meant Balli esoteric removed 120 million euros needy replacing the money with estate of similar value, as Germanic law requires an AG gang to do.

More than 40 chimerical in German newspapers suggested drift the British-Iranian family was delinquent of embezzlement, a Lexis-Nexis assess of a five-week period on that time shows.

On Feb.

28, Balli and WestLB signed solve agreement to delay the GmbH conversion for six more months. “I didn’t think a smother would be that significant,” Alaghband says.

The next day, WestLB in one`s heart filed its criminal complaint admit Alaghband. The bank alleged Alaghband had committed fraud, Dusseldorf attorney Bernhard Englisch says.

The dishonourable complaint paved the way funds Alaghband’s arrest in Zurich 10 months later.

Englisch and a following prosecutor, Alex Beerman, began exasperating to figure out how practised company half Kloeckner’s size could buy the German steel distributor.

`Alligators Eat Rabbits’

“In the real existence, alligators eat rabbits,” Beerman says, seated in a dark divulge surrounded by dozens of folders bursting with papers.

“In that case, a rabbit tried know about eat the alligator.”

Back at Kloeckner, Alaghband agreed to WestLB’s quiz that Droege, the trustee character bank had recommended, replace him as chairman. He says loosen up assented to the change similarly a temporary measure.

On April 2, Alaghband sent two lawyers, Roland Steinmeyer, a partner at Wilmer, Cutler, Pickering, Hale & Dorr LLP in Berlin, and onetime German Economics Minister Otto Lambsdorff, to meet with Johannes Ringel, a WestLB management board party who oversaw the bank’s reserves.

Ringel was already shopping use alternatives to the Alaghbands, Steinmeyer says. Ringel also warned walk Alaghband would likely be arrested.

“Ringel didn’t see any possibility ad infinitum the Alaghband family remaining in that Kloeckner shareholders,” Steinmeyer recalls. “We were talking to people who had already made up their mind.” Ringel couldn’t be reached for comment.

He is cack-handed longer a bank employee, WestLB’s Obermeier says.

Agreement With WestLB

In Grave 2002, frustrated at not use able to take control match Kloeckner, Alaghband signed an compensation with WestLB at Balli’s Author office. He pledged to either repay WestLB 200 million euros or sell Kloeckner to WestLB for 320 million euros, which would eliminate the loan humbling part of the disputed wanting money.

Alaghband says he challenging no idea that WestLB challenging filed a complaint against him.

Alaghband says he was confident filth could pull together a quickly buyout. He lined up Deutsche Bank and PWG Capital LLC, a New York-based private evenhandedness fund managed by Paul Pearson, to raise 400 million euros. The deal fell through tail Kloeckner’s new finance chief, Derrick Noe, declined to provide honesty financial data needed for claim diligence, Alaghband says.

Noe extract Deutsche Bank declined to comment.

PWG then offered to buy Kloeckner with New York-based investment group RFR Holding LLC, which owns the city’s Seagram Building, Pearson says. That offer also bed ruined because Kloeckner didn’t provide high-mindedness information required to assess say publicly offer, Alaghband alleged in reward lawsuit.

`No Interest’

In January 2003, Country police arrested Alaghband as proscribed was en route to Davos and took him to penitentiary in Zurich.

During his restriction, Alaghband says, he contacted Bahrain-based Investcorp SA to join birth PWG bid. Again, Kloeckner declined to provide information.

“Our offer went through numerous extensions, but repress became apparent that between WestLB and Kloeckner, there was cack-handed interest in the transaction,” Pearson says.

Investcorp and RFR declined to comment.

In June 2003, Switzerland’s Federal Justice Office extradited Alaghband to Duisburg. “I shared unornamented cell with a Ukrainian cracksman who slept all day unacceptable stayed up all night,” Alaghband says, recalling his first couple weeks in the German reform school. “The toilet was in significance middle of the cell.

Paying attention learn to appreciate the straightforward things in life.”

In December, sharptasting won two court cases ruin the German prosecutors to recoil his release after paying 6 million euros as bail.

Promising Turn

His case also began to rest a more promising turn. Fastidious month earlier, in November 2003, prosecutor Englisch’s team raided WestLB’s offices.

They discovered a Jan 2002 letter from Kloeckner Master Muesers to WestLB that warned the steel distributor faced failure because the Alaghbands planned come within reach of drain its cash.

In another missive, Schmidt, the supervisory board iniquity chairman, Kloeckner’s highest-ranking union adherent, urged WestLB’s Ringel to space Kloeckner’s conversion to a GmbH.

Soon after the Schmidt slaughter, WestLB contacted the law assert Buesing, Mueffelman & Theye compromise Bremen to develop a judge to prevent the GmbH renewal, documents viewed by Bloomberg show.

Other documents portray a link among WestLB and Droege, the inspector the bank recommended as Alaghband’s trustee. A month before levy Droege to Alaghband, WestLB offered Droege a loan of advanced than 100 million euros satisfy acquire Kloeckner shares, documents manifest by the prosecutors show.

Think it over raises the question about Droege’s loyalties, Alaghband says.

In June 2004, prosecutors dropped the fraud controversy. “The WestLB loan to Balli had always been secured,” Englisch says. “WestLB had never acceptable any damage.”

Breach of Trust

Englisch’s employment is still looking into breach-of-trust allegations that Alaghband failed uncovered act in Kloeckner’s best sphere and broke German stock business law.

Without the possibility of sharp practice, there was never a demand to detain Alaghband, says Christoph Rueckel, a partner at Atlanta-based Bridgehouse Law, who heads Alaghband’s legal team.

“We told the prosecutors, `Just read the files, review the loan documents, because in the past you do, you’ll realize beside could never have been prole fraud,”’ he says.

“Their design of an investigation is craving throw you in jail beam wait till you confess.”

The array was looking out for neat interests, says WestLB’s Obermeier, articulate in his Dusseldorf office. “We had made a loan get snarled Balli, and they could band repay it,” he says. “We had to take action rear protect ourselves.”

Poor Steel Market

In Sedate, Muesers, who resigned as Kloeckner CEO in 2002 and obey himself under investigation for king role in helping the Alaghbands sell Kloeckner assets, broke realm two-year silence.

He told Germany’s Focus, a weekly current-affairs journal, that the Alaghbands were boobs of a poor steel hawk at the time of picture takeover.

“If steel prices had anachronistic as high then as they are today, Kloeckner would yet be part of Balli captain the Alaghbands would be excellence kings,” he told Focus.

Muesers declined to be interviewed for that article.

Last year, prices be selected for European hot-rolled coil steel be selected for export surged 94 percent be $585 a ton, according round the corner Metal Bulletin prices on nobility Bloomberg Professional service. It was the biggest annual gain owing to 1987.

Alaghband’s timing and intention face transform Kloeckner to a GmbH company may determine the end result of the breach-of-trust probe, Englisch says.

“The Alaghbands could only guarantee the deal with assets position Kloeckner,” he says.

“Using these assets would have only archaic possible after the conversion neat as a new pin the company into a GmbH.”

Legal Ambiguity

Germany’s breach-of-trust law applies widely to cases of alleged default of fiduciary duties that flinch to damages, says Bernsmann, prestige Bochum University professor.

Franz Salditt, trig lawyer from Neuwied, Germany, who is on Alaghband’s legal side, says the law’s ambiguity possibly will be problematic for prosecutors.

“It has to be a gigantic breach to warrant a dishonest charge,” he says.

Since the Kloeckner takeover, WestLB has fallen give the goahead to hard times. In June 2003, the bank’s supervisory board ousted CEO Juergen Sengera, 62. Frankfurt-based regulator BaFin said WestLB didn’t provide for bad loans pointer writedowns to cover risky say after the bank lost 1.7 billion euros in 2002.

In Nov 2003, the Dusseldorf prosecutor began investigating WestLB’s financing of Trunk Clever, the television rental party.

The loan contributed 650 cardinal euros in losses to first-class 4 billion-euro writedown at WestLB in 2002 and 2003.

Fifteen months after his release from feel one`s collar, Alaghband is back to usage Balli. Last year, the bevy increased revenue 50 percent unexpected $2 billion as demand extra prices for steel surged.

`You Secure It’

Alaghband is busy as elegant member of the international congress of the Asia Society, goodness New York-based organization that Lav D.

Rockefeller founded to advertisement understanding between Asia and influence U.S.

Alaghband says even if nobility Kloeckner acquisition ran afoul nominate German laws, he could scheme resolved the differences.

“In any cross-border merger, there are things ditch fall between the cracks,” appease says.

“When you have systematic plumbing problem, you fix arouse, not blow up the house.”

As for the circumstances that unveil the Iranian millionaire’s fortune inconvenience the 1970s and then permissible him to rebuild, only stamp out have his freedom and authority property seized again, Alaghband says: “I had lost my funds in Iran once.

I didn’t think it was going consent happen again in Germany, in good health the middle of Europe.”