Private equity row as car tycoon Peter Waddell offered settlement in investment dispute

A fierce legal row has erupted between Big Motoring World founder Peter Waddell and private equity group Freshstream, with Waddell claiming he was ousted from his own business through what he describes as a targeted investigation. The dispute has also seen Freshstream table a settlement offer of €1.1 million in a separate but related clash over forfeited investment cash.

Waddell, once at the helm of the renowned used car empire, filed an initial High Court case last year. His claim centres on allegations that Freshstream manipulated the findings of an independent inquiry into contested racist, sexist, and abusive remarks, ultimately engineering his exclusion from Big Motoring World. Freshstream had acquired a one-third share in the company in 2022, marking a significant stake in the rapidly growing business.

Alongside his core claim, Waddell launched a second legal action, disputing Freshstream’s move to force him to forfeit a €1.5 million investment in one of its own funds. Court filings argue this action was taken because Freshstream sought to remove what it viewed as a problematic investor, severing all ongoing connections. In an attempt to resolve this dispute, Freshstream has offered Waddell €1.1 million—calculating this figure as his net contribution after he previously received €450,000 from the fund. Freshstream maintains that it acted within its rights, arguing the forfeiture followed Waddell’s company missing a scheduled payment into the fund.

The settlement proposal arrives ahead of an anticipated High Court showdown next year, where both parties will contest the central issue of Waddell’s April 2024 exit from his company. Waddell’s legal team alleges he was denied the opportunity to address highly sensitive accusations, which included historic claims of severe misconduct towards female employees. According to Waddell, the investigation—prompted while he was on medical leave for a heart condition—reviewed 764 pages of evidence and relied on testimonies from 22 individuals. His legal advisers requested more time to respond, but the company pressed ahead, citing “intolerable risk” to the business in delaying proceedings.

Freshstream’s internal review reportedly found that in the majority of the 27 incidents considered, there was sufficient evidence of material default to warrant Waddell’s removal. For Waddell, the case highlights what many entrepreneurs see as a growing phenomenon: investors utilising contractual clauses and investigative processes as tools to remove founders from their own enterprises after funding rounds have handed controlling stakes to outside parties.

This high-profile case serves as a reminder of the tensions that can arise when private equity enters the boardroom, raising important questions about the balance of power between founders and investors in the UK’s financial landscape.