DRAGON’S Den star Duncan Bannatyne has hit back against a former employee's claims that he hid £10 million from his wife during his divorce, stored money in a secret offshore account and used company cash for personal use.

The Darlington-based entrepreneur faces a £10 million lawsuit from his former CEO Nigel Armstrong who he sacked for gross misconduct in September last year.

Court documents claim Mr Bannatyne - who is worth an estimated £175 million - forged evidence to hide £10 million from his wife Joanne McCue in a divorce case and used company cash to pay for his iTunes account, fund part of the multi-million pound divorce and purchase a £33,000 Audi for his daughter.

In the High Court petition Mr Armstrong, 44, also accuses Mr Bannatyne - who is currently in the Australian jungle for the reality show I'm A Celebrity, Get Me Out Of Here - of setting up off-shore companies and bank accounts in Monaco and the British Virgin Islands.

A spokesman for Mr Bannatyne said: “This will be contested and counter-actioned and we fully expect to win when the facts are presented in front of an independent judge.

“It is nasty that this has been publicised while Duncan is in the jungle and unable to defend himself.”

Duncan Bannatyne branded 'a mouse' by Lady C in I'm a Celebrity 

In a counter-claim Mr Bannatyne, 66, says he was forced to fire Mr Armstrong for gross misconduct.

The entrepreneur will accuse Mr Armstrong of touching the "bottom, breasts and other parts" of a female employee and taking off his shirt to "flex his arm and chest muscles" after a gym session in front of another female employee.

Mr Bannatyne claims Mr Armstrong bought paintings and two silver pheasants using company money to decorate his own home and paid himself and his wife hundreds of thousands of pounds in extra salary from Bannatyne Fitness Limited.

The court documents also allege that coffee machines that went "missing" from the company were sold on Mr Armstrong’s eBay account.

They also claim fraud by the group's former finance director, Christopher Watson, may have been prevented if Mr Armstrong had not "acted negligently".

Watson was jailed for four years and eight months at Teesside Crown Court two weeks ago after admitting fraud. The court heard how he took almost £8m from the company between 2008 and 2014.

Mr Armstrong claims he tried to alert Mr Bannatyne to the fraud, but the court documents say: "The loss and damage suffered by the company as a result of (Mr Armstrong's) gross negligence consists of the moneys that were taken... as a result of Mr Watson's fraud, which losses (or most of them) could have been prevented if (Mr Armstrong) had not acted negligently."

Mr Armstrong, who has worked for the health club tycoon since 1997, claims Mr Bannatyne broke a “contingency agreement” when he sacked him.

The agreement had guaranteed Mr Armstrong £10 million if the business was sold or moved from its head office in Darlington.

However Mr Bannatyne and his firm allege they owe Mr Armstrong nothing due to his conduct and the money he allegedly took.