|
Mosvold cancelled the first vessel order on May 18, and under the terms of the contract it was entitled to a refund of its deposit and interest accrued. Mosvold had indicated earlier that Otto was unlikely to be able to complete the second vessel in time, according to a DMG Research analyst report this month. The report also said that Mosvold would have a problem paying the remaining payable amount of US$54 million. Mosvold had a cash balance of US$5.7 million as of the end of September, according to the report. The second vessel was to have been delivered yesterday, but The Straits Times understands that this did not happen. Instead, Otto said last week that it had filed and served on Mosvold a notice of arbitration over the vessel, saying there were disputes over its delivery date. As agreed in the contract, the dispute must now go before the Singapore International Arbitration Centre. In yesterday's announcement, Otto Marine also said that the High Court had granted an injunction against Norsk Tillitsmann, a Norwegian supplier of financial agreement trustee services, restraining it from making any calls on the refund. Norsk Tillitsmann is the assignee of the refund guarantees in the contract between Otto and Mosvold. In a statement to the Singapore Exchange last week, Otto said it was 'seeking a declaration that the delivery date be postponed, adjusted, open ended or alternatively at large, and other further relief as may be appropriate'. The Straits Times understands that in these vessel transactions, 30 per cent is first paid as a deposit and the rest is paid on delivery. Otto Marine owns a 4.15 per cent stake in Mosvold Supply, according to Bloomberg data. Otto Marine's counter yesterday closed one cent higher at 34 cents. Otto Marine |
Otto Marine Blocks Client From Refund (ST)