Monday, June 27, 2011

Lanco Infra Vs Perdaman.

The Lanco Infratech stock stabilised to close in the green today after Friday’s mauling on the back of the 3.7 billion dollar lawsuit filed by Australian-based Perdaman Industries. This despite Lanco issuing advertisements in leading dailies, clarifying its position on the dispute.

Speaking to CNBC-TV18, Lanco Infra CFO J Suresh Kumar said that the Perdaman's claim of a contract breach was " baseless ". He added that the company is confident of their legal position and add that will respond in an appropriate manner.

Perdman had signed a coal supply agreement for 25 years with Griffin Coal, which was acquired by Lanco last year. As per agreement, Griffin Coal was to supply 2.8 million tonne of coal to Perdman every year.

The case will be heard in court on July 27.

Meanwhile, Andreas Walewski, director (corporate), Perdaman Chemicals clarified that the lawsuit was based on conduct of Lanco . He said Lanco’s actions had put the project at risk.

Understandably, both companies have their own versions about the dispute.

Lanco maintained that they were always open to a dialogue and would have preferred if Perdman had approached them instead of going to court.

However, Walewski said, there were several meetings held between the two companies. He also said the concern raised by Lanco of financial closure is not an "issue".

The bone of contention — supply of coal — also seems to be somewhat unclear. Kumar said the contract is still effective. “As we see it, there is no termination that has happened. We were actually quite surprised that they preferred to go through court rather than through discussions,” he said.

Kumar is unsure about how Perdman arrived at a damages claim of Rs 16,733 crore, however, he said, that the legal costs will not to be too material.

Walewski on the other hand said the sum is based on the value of project.


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