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SEMBCORP Marine has entered into a settlement agreement with Marco Polo Marine in relation to a legal spat between the two parties that has been brewing since last year.
SembMarine told the Singapore Exchange in a filing after markets closed that its unit PPL Shipyard has entered into the agreement with Marco Polo Marine and its subsidiary, Marco Polo Drilling, on a without admission of fault or liability basis.
This was based on the terms that a consent award be entered into in favour of PPL Shipyard for the whole of its claim and interest in the arbitration proceedings, and with Marco Polo Marine and Marco Polo Drilling withdrawing their own respective claims.
Marco Polo in November 2015 had decided to terminate a newbuild contract valued at US$214.3 million for a jack-up rig that was under construction at SembMarine's 85 per cent owned PPL Shipyard, alleging that the shipyard had failed to comply with certain contractual obligations.
PPL Shipyard, which initially rejected the termination, took action after it said that Marco Polo failed to pay a progress payment plus interest.
SembMarine said in its latest statement that the matter is not expected to have any material impact on its net tangible assets and earnings per share for the year ending Dec 31.