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Geo Energy engages legal advisers on potential dispute related to proposed acquisition
COAL producer Geo Energy Resources on Tuesday said it has engaged legal advisers in response to news reports about a potential dispute over a proposed deal in Indonesia.
Media outlets reported that the current or former ultimate controlling shareholders of Titan Infra Energy (TIE) filed a legal claim in the Jakarta courts against, among others, TIE and its major subsidiaries, Victor Tanuadji, as well as two Geo Energy subsidiaries - Geo Ventures Global (GVG) and Geo Coal International (GCI) - for acting against the interests of TIE shareholders.
The claim is in connection with Geo Energy's proposed US$25 million acquisition of the entire stake in Titan Global Energy from TIE and its affiliate, as well as coal purchase agreements signed between GCI and TIE.
Mr Tanuadji is a TIE director and the son of Handoko Tanuadji, the ultimate controlling shareholder of TIE and its subsidiaries, according to TIE's 2018 audited financial statements dated Dec 23, 2019. Mr Victor Tanuadji is also a guarantor of the coal purchase agreements between GCI and TIE.
The proposed Titan Global Energy deal, announced last September, would have given Geo Energy a majority stake in two South Sumatra coal mines. GVG had entered into a conditional share-purchase agreement with TIE and its affiliate, Jaya Utama Indonesia, for the acquisition.
However, in April this year, Geo Energy said the agreement had been terminated as the conditions precedent were not satisfied by the extended long-stop date of March 31. As such, the sellers, TIE and its affiliate, were required to return the deposit of US$2.5 million to Geo Energy within 14 business days from April 1.
On Tuesday, Geo Energy noted that although neither GVG nor GCI had received any court summons or official notification of the TIE shareholders' claim, its appointed Indonesian legal advisers will monitor any developments and advise the group on its legal position.
"If GVG and/or GCI receives any court summons or official notification of the legal claim the group will make a further announcement and defend any claims against GVG and/or GCI."
The TIE shareholders that reportedly filed the claim told Geo Energy that they plan to initiate settlement discussions with the group in relation to the claim.
As at 10.22am on Wednesday, Geo Energy shares were trading at 12 Singapore cents, up 0.5 cent or 4.4 per cent.