In a development which can be termed as a “big relief” for lanco Infratech, the diversified group on Monday said that it will pay AUD $7.5 million to settle the protracted AUD $3.5 billion- legal battle with Australia's Perdaman Chemicals over coal supply issues.
lanco has agreed to pay the amount without admission of any allegations raised by Perdaman related to fuel supply from Griffin Coal, which was acquired by the group for about AUD 730 million in March 2011.
Perdaman had filed the lawsuit against lanco in Australia, alleging non-compliance with fuel supply pact by Griffin Coal for its upcoming urea plant in Western Australia.
The protracted litigation for a claim of AUD 3.5 billion initiated by Perdaman Chemicals against Griffin Coal, lanco group and its officers, in the Supreme Court of Western Australia is now at an end, lanco said in a statement.
The company has agreed to “pay Perdaman a nominal amount of AUD 7.5 million (about Rs 42 crore at current exchange rate) plus legal costs to be taxed by the Court, without admission of any of the allegations of Perdaman”.
“The (settlement) is a big relief. It is a fantastic outcome for lanco and will have a positive impact on the entire group. The settlement was reached on April 26 pursuant to the rules of Supreme Court of Western Australia, which allows for early and cost effective resolution of such claims.
In a separate statement, Perdaman said settlement of the case is scheduled to be completed by May 24.
Kandimalla said the legal costs related to the settlement would be AUD 3-3.5 million to be paid over a period of 9 to 12 months.