MADRID (Reuters) – A high-profile row between Spain’s Santander <SAN.MC> and Andrea Orcel will go to a court showdown in March after they failed to reach a deal over the withdrawal of an offer to make the Italian banker chief executive.
Orcel, among Europe’s top investment bankers, is claiming breach of contract by the euro zone’s third-largest bank by market value, and suing for 112 million euros ($126 million).
He was offered the role of CEO in September 2018 but Santander changed its mind the next January, saying it could not meet his pay demands, in a rare U-turn involving such a high-level appointment at a major bank.
Lawyers for both parties, wearing masks to respect COVID-19 rules, told a preliminary hearing in a Madrid court that they did not want an out-of-court settlement.
As a result, the judge said the dispute would now go to trial starting on March 10 next year, when Santander chairman Ana Botin will be among the witnesses called to speak, at the request of Orcel’s legal team.
Axel Weber, chairman of UBS <UBSG.S> was also added to the list of witnesses. UBS declined to comment.
Jose Miguel Fatas, a lawyer for Santander, said it had not asked for Orcel be put on the list of witnesses because what was at stake was not the facts but legal issues and the Italian would not therefore speak at the trial.
“Our thesis is very simple, there is an offer letter that they say is the (job) contract and we say that it is not the contract,” Fatas told reporters after the one-hour hearing.
Orcel’s lawyer Alvaro Remon, who did not respond to a request for comment, had earlier told the court: “What we ask for first of all is that the contract be fulfilled.”
TWO KEY WORDS
Much of the trial will revolve around whether a September, 2018 four-page offer letter was a binding job contract, as Orcel says, or a non-binding initial offer, as the bank says.
“How much meaning can be attached to those two words: recruitment and appointment. And that’s all I’m saying”, judge Javier Sanchez Beltran told the court.
Santander promised to pay “up to” 35 million euros of a 55 million euro package that Orcel was due to receive in future years from his employer at the time, UBS.
The letter said Orcel would make his “best efforts” to cap that cost by getting the Swiss bank to contribute some of it.
However, UBS refused and Orcel then told Santander he would not accept less than 35 million euros.
Orcel, who was head of UBS Group’s investment banking business at the time, resigned from the Swiss bank when he was offered the Santander job.
Neither Orcel nor Botin were in court for Monday’s hearing, which wrapped up after focusing on issues such as procedural evidence and which witnesses would be accepted.
(Reporting by Emma Pinedo and Jesús Aguado; Additional reporting by Mike Shields; Writing by Ingrid Melander and Jesús Aguado; Editing by Alexander Smith)