The world of celebrities isn’t the only one that gets wracked by divorce; the long hours that hedge fund managers put in can also exact a toll on familial relations. As Sir Chris Hohn is learning, sometimes that toll can be steep indeed. Hohn, the founder of The Children’s Investment Fund, has been presented with a divorce settlement by his wife for half of their combined assets. If this case presents its way through the courts without modification, it will be the single largest civil divorce payout to date in British history, with an assessed payout of $1.4 billion.
Ms. Cooper-Hahn couldn’t have picked a more favorable venue for a divorce proceeding, particularly one of this magnitude. London’s recent divorce court payouts include £24.3m paid to Heather Mills when she divorced Sir Paul McCartney. Mills got half of what Beverly Charman received when she divorced insurance mogul John Charman, and Galina Besharova extracted almost £200m from Boris Berezovsky.
Hohn, who is notoriously publicity shy, has four children with Cooper-Hohn, and had offered 25% of their joint assets, and has made a case that wealth as earth-shattering as his exceeds the usual presumptions for a joint division of assets. At this point, the discussion and speculation is that Cooper-Hohn will end up with more than 25% and less than half of Hohn’s assets.
The court refused Cooper-Hahn’s attempt to get her own expertise recognized in the management and valuation of TCI’s management companies. She characterized her higher valuation as one that presumes that Sir Chris would be unable to leave the TCI, based on his past behaviors and the amount of time in his life he’s been accumulating capital. Her claims are that he’s generated $5.7 billion, and that, per her attorney, he is unable to walk away from the companies he built, and thus his expertise should be considered part of the overall valuation.
The TCI fund awarded £20m in performance bonuses in the last year; while arguments have been made that these bonus payments undermine the argument of Sir Chris’ total contribution to the management of the TCI group – to wit, those bonuses prove that while he is capable, he is not irreplaceable. Hohn’s own attorney drew comparisons to David Beckham and other sports figures who end up the sole decision maker. This case is highly visible to the public eye due the enormous amounts of money involved in any settlement given to Cooper-Hohn, and it’s still in the opening arguments. The trial, slated to last ten days, should continue for quite some time.