Forget birthday cake, try some humble pie

Excuse me for stating the freaking obvious, but is Eric Watson a bit slow? Or just bollock-clutchingly arrogant? I like a Bacchanalian knees-up as much as the next girl, but when you have just had to beg investors for a five-year moratorium to pay back their own money, throwing a $1.1 million hooley to celebrate your birthday seems, frankly, moronic. What is wrong with a few quiets down the road?

Does he not read his own clippings file, about investors like Lynne who begins, "I do want to wish Eric Watson a happy 50th birthday" but says her ailing father invested $6000 in Hanover Finance - part-owned by Watson - which was due for repayment last October. "A couple of weeks before he died he called my brother up and was extremely distressed because he wasn't able to leave enough money for his funeral and he knew that it would just about clean out my mother's bank account to pay for it. Which it has," Lynn writes on a blog about Hanover.

"[Mum] really could do with that $6000 which is due her, now, not in six years' time when she may not even be here. Perhaps Eric doesn't have a mum he cares about, or else he would understand my distress about his disgustingly decadent birthday party."

Just to refresh your memory, Hanover Finance last July suspended repayments of half a billion dollars' worth of deposits and in December grovelled to investors to give them five years to pay back their principal: no interest, sorry chaps. Watson didn't even deign to return home to New Zealand from his London base to front up and sell the restructuring plan. Now he has added insult to injury by throwing an embarrassingly nouveau two-day party in Istanbul to mark his 50th birthday. There were not many Kiwis on the guest list, judging from the Eurotrash society page pics, although it's lovely to see so many men took their daughters along.

What is weird is that Watson well knows that reputation is everything in business. That's why he gave Hanover a posh name and got the gravitas-for-hire of newsreader Richard Long to front Hanover's ads. So the real cost of his party is not the $1.1 million to rent the Orient Express station, or even the bubbly and Turkish delight: it is the further damage to his reputation back home. After the winebox I remember one PR guru saying to me that Sir Michael Fay would have been better to have handed over his entire fortune to charity and started from scratch: he would have helped his reputation and could have put his brainpower towards making another fortune. Instead, the Fays went overseas.

Presumably Watson is hoping his cool new friends - like US Office Products founder Jon Ledecky and private jet entrepreneur Robert Hersov - will help him do more lucrative deals. Because despite the cheesy smiles in Turkey, business has been patchy. Since his birthday party Watson's Victory Acquisition Corporation notched up a defeat, announcing it would be liquidated after failing to consummate a deal to merge with jukebox advertising company Touch Tunes.

Meanwhile, Hanover's owners have not been making friends back in New Zealand. Property developers who borrowed money from Hanover aren't getting the easy-peasy understanding treatment meted out to Watson and business partner Mark Hotchin. Hanover took bankruptcy proceedings against Andrew Krukziener over $6.98 million owing, bankrupted Wellington yachting businessman Stewart Thwaites over a $4.5 million loan and is involved in a court battle with Mark Cooper, who owes about $30 million and has just put his $2.6 million Waiheke holiday house up for mortgagee sale. In just the past couple of weeks in the Auckland High Court, Hanover has sued property developer Dhanshuk Amarsee for $3.3 million, sued Dan McEwan for $4 million and bankrupted Fitzroy Hotel developer Zhang Hong Wu. I am sure they, and Lynne's mum, join me in raising a toast to Eric: cheers, mate.

deborah@coneandco.com