Lars Windhorst Story - Lars Windhorst's Comeback
Lars Windhorst stands for a lot of what the country has been accusing its bankers of for months: greed, boundlessness, immoral behavior. At the young age of only 33, former prodigy of Helmut Kohl looks back at half a dozen bankruptcies and charges. This year will be his year, he says. Still, billionaire businessmen trust him with their money. Why is that?
A long-term reportage.
Article from Handelsblatt Magazine
Splendid crystal chandeliers flood the room with warm light. Modern art on the walls, abundant and meticulously arranged flowers decorate the area between the lounge and the dining hall. Attendants dressed in black and white keep their distance respectfully. It is lunch time in the city of London and no one comes to this exclusive private club just for dining. Business is made here, big business. At a table in the middle of the room is sitting a man in his mid-thirties, his back is in an upright position. His suit: Kiton, dark blue, custom-made; the black leather shoes: handcrafted. Lars Windhorst came with two men, both are about 15 years older them him. One of them, a graying Korean, is a rich man working by private means. The other one comes from a South African billionaire family. They talk and joke with each other. It looks like they are friends. "I could be Lars' biggest enemy", one of them says. They trusted the youngster with their money. This way they lost nine million euros five years ago. And about a year ago the youngster again went bankrupt with their joint company. Afterward they made him their partner. Almost unnoticed Windhorst made some of his biggest deals in the last year. He put companies back on track, and even helped out a Dax-company. And this year, he says, will be his year. He has deals of billions in mind. How is it possible? This is one of the greatest mysteries. Why do the two men in the London restaurant who have a lot of money, influence and very good lawyers not haul the young German before the courts in order to get their money back - which would be quite common these days. If you would want to give the crisis in Germany a face it would be Lars Windhorst's face. He stands for a lot of what the country has been accusing its bankers of for months. Greed, boundlessness, immoral behavior. He can seem undiscerning, obstinate. At the young age of only 33 he looks back at half a dozen bankruptcies and charges. "What do people want?" Windhorst says. "For me to lay down and curl up?" He does not understand the constant carping about him wearing expensive tailor-made suits and about his expensive office in Berlin with a view at the Reichstag. He works hard, is successful, but sometimes he fails. This is the way he sees things. The question is, how does he convince people after each crashing failure that he will be able to make even bigger bucks out of their big bucks? Rob Hersov is smiling. "I am more than happy to answer this question for you." But he is too polite to discuss business matters before the meal. For now he recommends the fresh salmon, "simply exquisite". Well, Mr. Hersov, how do a billionaire’s son from Johannesburg and a school dropout from Ostwestfalen get together?
1. How does a South African billionaire of all things meet with Windhorst
“I met him ten years ago through Michael Douglas“, Hersov says. The Hollywood star used to be one of Windhorst's business partners. Windhorst was not even 25 years old back then. Meanwhile he gave up his international computer business which he once started at the age of fourteen from his parents' garage. Now he has switched to the supreme discipline of economy where the big wheels are being turned: the financial industry. He wants to be among the biggest to move billions. Hersov is excited right away. This boy speaks broken English but he radiates self-assurance and enthusiasm in a way even Hersov has hardly seen before. Hersov himself was an investment banker. First at Goldman Sachs, then at Morgan Stanley. He managed companies, acquired and sold them. He has played the game a hundred times before. He knows the rules, the tricks. But he has never never witnessed one like Windhorst before. He absorbs advice. Out of each important contact he makes two, three new ones. He is constantly on the move, seems to barely sleep. Davos, Hong Kong, Moscow. He adapts his lifestyle to the people he encounters all over the world. Windhorst takes private jets and limousines. His businesses become more and more spectacular. In 1995 for example he wants to build a 200-meter-high office tower in Saigon called the Windhorst Tower. Simply, because he likes the idea. Today he finds it absurd himself. The tower was never built, and it was not the only project that turned out to be a flop. It happened what happens to Windhorst time after time. He does not cut back, he raises the stakes. Windhorst borrows more money. First, at the banks, then from business friends, at the end from friends of business friends. In 2004 his companies file for bankruptcy. He himself gives an oath of disclosure. He cannot pay anywhere by credit card anymore. He would not even get a cell phone contract. He shuts himself away and does not give any interviews. Still the breakdown of the wunderkind who traveled at the age of seventeen alongside of Chancellor Helmut Kohl to Asia is subject of detailed media reporting. It is the hour of enviers who do not bother to conceal their malice in the first place. Pity? Windhorst does not earn it, his former business partners say. Overall Windhorst owes his creditors 80 million euros, the established claim they are left with. .
2. One leaves his family to see Windhorst at his business dealings
November, 2009, at the Londoner Billionaires Club. Waiters serve the salmon at Hersov's table. Rob Hersov is spreading his thick snow-white napkin on his knee and closes the small talk. "How is business? We must have lunch." Seok Ki Kim observes the performance with Asian restraint as he views life generally with the kind of serenity which probably only a few hundred million euros of private means allow to do so. He, too, trusted Windhorst, and he, too, lost a lot of money. "Out of five millions remained just 90,000. I could be Lars' biggest enemy. But I am his most loyal supporter." Technically Kim withdrew from the acting business life by. He has two children. However a couple of weeks ago he moved from Hong Kong to London, without his family. He says: "It will always bring me great joy watching Lars grow. He reminds me a little bit of myself when I was that young." For a brief moment it is not clear if Windhorst is supposed to smile or laugh. Kim's words are similar to a knightly accolade, the approval of Windhorst belonging to it, to the Top of the World. To the gentlemen of globally vagabonding billions. Kim is an idol, an endless source of financial know-how. Windhorst knows to recite his resume back and forth. He received his Doctor at the Harvard Business School at the age of 29. At the age of 30 he became manager of Asian business for Bear Stearns. One year later, in 1989, he established his own bank in Hong Kong. For ten years he dominated the business with new investments in Indonesia. He became one of the most influential bankers of Asia. Now he became a part of a peculiar triumvirate. Six years ago he and Hersov gave Windhorst some money to play with in order to see what he can make out of it. This is how everything began. Windhorst exceeded their expectations by far. "Lars is a genius", says Hersov. This is why he makes decisions which no one in Germany understands. A conference room at the airport of Münster. It is the summer of 2005 and Bernd Fennel, owner of cell phone supplier Balda wants to buy his shares of the company. Balda member of the board Joachim Gut is supposed to present his company to potential investors. The door opens. Hersov enters. At his side: Lars Windhorst. A moment later Gut gets up and leaves the room. He does not want to work with Windhorst. Hersov follows him and puts it in a nutshell. Windhorst is managing his German investment company Vatas. Either Gut will make the deal with Windhorst or not at all. Gut backs down. What Windhorst does with Balda in the next couple of years makes everybody grasp. Within a few months the cash-stricken cell phone supplier becomes the new insider tip. Guy Wyser-Pratte from the US buys large blocks of shares as well as Michael Treichl with his Fonds Audley and former head of Premiere Georg Kofler. Market price reaches twelve euros. Then it tumbles. In February 2008 the share's value is Euro 2.50. Wyser-Pratte loses his nerves and sells. Treichl sells parts for less than one euro. Balda is a good example for how Windhorst's businesses have been running since 2005. At first - big success, then - drama. By the end of 2007 Vatas generated a profit of roughly 250 million euros. Windhorst does not put anything aside and does not pay back any of his older debts in order to get rid of his past. That would be going against his nature. Windhorst does not want peace, he wants more, much more. He wants to be the best. The disaster follows its inevitable course.
3. First a plane crash, then a business break down
December 2007. Windhorst is sitting inside the cockpit of his private jet and gazes into the Kazakhstani night. Just a few hours ago he celebrated Christmas with his family in Westfalen. After stopping in Kazakhstan he is on his way to Hong Kong. A crisis meeting in the matter of Balda. But he never arrives. The Challenger barely took off when the air stream breaks off. The plane tilts to the right. At 300 kilometers per hour it hits the ground while one wing
breaks and the torn open metal hunk heaves above the concrete with deafening noise. Windhorst is being hurled out of his seat. He looses his right ear. The next moment he lies unconscious in the Kazakhstani snow. At temperatures of -14 degrees Celsius. Ten days later his driver awaits him at the Heathrow London airport. A mummy gets in the car, his whole head in bandages, without teeth. Windhorst can hardly speak. What his driver does understand: "To my office. I have to work." It is useless. The next months will be the worst in Windhorst professional career. Markets are collapsing, stocks rapidly lose value. To
Windhorst this is a huge problem since he is financing his businesses with shares and stock options. After running short of money he plunges his business partners into the abyss. What is he doing? He is being himself. Full risk. He promises to new and old investors cocksure dealings. "Buy stocks for me and within a few months I will purchase them back at a higher price. Zero risk." It is a desperate attempt to make profits without investing own money. Business can only work as long as the prices will rise. But they collapse. By the summer of 2008 Windhorst is putting his customers off. He cannot cash them out. Next, the bank freezes his accounts. He sits on a mountain of debt, more than 200 million euros. In the beginning of 2009 Windhorst's company Vatas files for bankruptcy. Quite a number of business associates take legal action. In the pleadings of their lawyers there is again talk of criminal act. Insider Trading, market manipulation, delayed insolvency petition. Rob Hersov remains straightfaced when being confronted with these days. "You know what was going on at the markets back then. Well, we got caught off guard. But who didn't?" Hersov takes a sip of red wine. Then he bends over the table. "Don't stare. But the man at the corner table to your right ... three years ago he was estimated at six billions. And now? Maybe one." This is the way it is. Sometime you win, sometimes you loose. Not everybody who lost money with Windhorst can and wants to stay this calm about it. After all Windhost did not just crash at the stock exchange. He breached contracts. He does not repay his debts although he probably has been able to do so for a while. Some who take legal action now even scent a long-planned deception.
breaks and the torn open metal hunk heaves above the concrete with deafening noise. Windhorst is being hurled out of his seat. He looses his right ear. The next moment he lies unconscious in the Kazakhstani snow. At temperatures of -14 degrees Celsius. Ten days later his driver awaits him at the Heathrow London airport. A mummy gets in the car, his whole head in bandages, without teeth. Windhorst can hardly speak. What his driver does understand: "To my office. I have to work." It is useless. The next months will be the worst in Windhorst professional career. Markets are collapsing, stocks rapidly lose value. To
Windhorst this is a huge problem since he is financing his businesses with shares and stock options. After running short of money he plunges his business partners into the abyss. What is he doing? He is being himself. Full risk. He promises to new and old investors cocksure dealings. "Buy stocks for me and within a few months I will purchase them back at a higher price. Zero risk." It is a desperate attempt to make profits without investing own money. Business can only work as long as the prices will rise. But they collapse. By the summer of 2008 Windhorst is putting his customers off. He cannot cash them out. Next, the bank freezes his accounts. He sits on a mountain of debt, more than 200 million euros. In the beginning of 2009 Windhorst's company Vatas files for bankruptcy. Quite a number of business associates take legal action. In the pleadings of their lawyers there is again talk of criminal act. Insider Trading, market manipulation, delayed insolvency petition. Rob Hersov remains straightfaced when being confronted with these days. "You know what was going on at the markets back then. Well, we got caught off guard. But who didn't?" Hersov takes a sip of red wine. Then he bends over the table. "Don't stare. But the man at the corner table to your right ... three years ago he was estimated at six billions. And now? Maybe one." This is the way it is. Sometime you win, sometimes you loose. Not everybody who lost money with Windhorst can and wants to stay this calm about it. After all Windhost did not just crash at the stock exchange. He breached contracts. He does not repay his debts although he probably has been able to do so for a while. Some who take legal action now even scent a long-planned deception.
4. Some take legal action, but some enemies suddenly become friends again
US-financial investor Alki Capital for example, has been buying on the basis of an agreement with Lars Windhorst since April 2007 a large number of equities of the US-company Remote-MDx. Windhorst's company is supposed to acquire them at a higher price later on. Moreover, the NordLB purchases scarcely traded shares as agreed upon with Windhorst - at a value of 116 million dollars. Earnings per share rise from 1.50 dollars to more than four dollars. Business friends of Windhorst and Hersov have sold in between according to Alki's petition. But when Alki wanted to give back the shares to Windhorst's company according to the agreement, the company can't pay him out. Today RemoteMDx trades around ten cents. Both, Alki and NordLB demand compensatory damages. Last week on Wednesday, a court judged the NordLB to be justified in first instance. The bank is to receive one million in damages. Windhorst intents to appeal. Effectively the financial liability was not allocated as clearly as the plaintiffs hoped it to be. Alki bothered about the business not until it went wrong. And the NordLB? Who ever knows the case, feels that the bank acts in a hypocritical way. For years they made millions with Windhorst's deals. Insiders refer to dozens of transactions and nine-digit numbers. Windhorst has been a popular guest within the boardroom. He arranged contacts to customers worth billions. Yet one questions remains. What exactly happens when Windhorst dedicates himself to a company? Does he generate an artificial demand when he drags along one major shareholder after the other? Do some always have to loose for others to win? Does Windhorst play his associates off against each other? Nonsense, Windhorst says. Each investor makes his own decision. He can only give advice. These words of advice are the reason for some business partners like Kim to leave their families, and for others to press charges against him. Windhorst divides the world into friends and enemies. Whoever does not stand on his side is at the other side. Even if they don't have to stay there forever. Multimillionaire Georg Kofler for example did listen to Windhorst. For quite a while it seemed as if this had cost him a lot of money. When the shares of cell phone supplier Balda fell into the bottomless abyss, a lot of large-scale investors sold their shares - they lost two-digit million figures. Kofler, on the other hand, talked to Windhorst and purchased more when share was priced at 50 cents. Today, it trades around 3.50 euros and Kofler is as of late shareholder of the joint company of Hersov, Kim, and Windhorst.
How is this possible? Multimillionaire Rob Hersov eyes Windhorst suspiciously. They have finished the salmon, now they reach the point where they drink espresso. Hersov says: "Every day I see what Lars accomplishes. No one in this business works as hard as him, and I know what I am talking about." Maybe he best understands to utilize Windhorst's talent without taking an incalculable risk. Maybe it is necessary to have a great deal of money as he does in order to accomplish his view of things. "If I was not convinced about the possibility to make a couple of million euros with Lars, I would have left a long time ago", says
Hersov. "But this is big bucks we are taking about here.“
How is this possible? Multimillionaire Rob Hersov eyes Windhorst suspiciously. They have finished the salmon, now they reach the point where they drink espresso. Hersov says: "Every day I see what Lars accomplishes. No one in this business works as hard as him, and I know what I am talking about." Maybe he best understands to utilize Windhorst's talent without taking an incalculable risk. Maybe it is necessary to have a great deal of money as he does in order to accomplish his view of things. "If I was not convinced about the possibility to make a couple of million euros with Lars, I would have left a long time ago", says
Hersov. "But this is big bucks we are taking about here.“