[*More on Story] Singapore Court Awards Damages To Local Unit of Canadian Firm
By RICHARD BORSUK
Staff Reporter of THE WALL STREET JOURNAL
SINGAPORE -- A Singapore court has awarded damages that could reach nearly US$40 million to a Singapore unit of a Canadian investment company that won a suit brought against the parent company of Pacific Century CyberWorks Ltd.
The Singapore High Court, in a judgment issued on Monday, ruled that Pacific Century Regional Developments Ltd., a Singapore-listed company that is the parent of Hong Kong-based CyberWorks, had breached a shareholders' agreement it signed in 1997 with Canadian Imperial Investment Pte., a unit of a Vancouver-based company named CML Global Capital Ltd.
In 1999, Canadian Imperial Investment filed a claim against PCRD, as the Singapore vehicle of Hong Kong businessman Richard Li is known, over PCRD's sales of its interest in Quinliven Pte. to Tricom Holdings Ltd., which was later renamed CyberWorks. Canadian Imperial had owned 25% and PCRD had owned 75% of Quinliven, created jointly to develop an underground parking garage in Shanghai.
The case was argued in a Singapore court in April. High Court Judge Lai Kew Chai, in a 48-page ruling, said the defendant had breached a clause in the shareholders' agreement. In his ruling, the judge said he accepted the plaintiff's argument that it was entitled to 27,387,097 shares of Tricom. Judge Lai awarded damages of 27,387,097 multiplied by the "market price of Tricom shares as at date of judgment," plus another US$1.025 million in costs that Canadian Imperial said it had incurred.
On Monday, the day the judgment was made, CyberWorks closed at 10.50 Hong Kong dollars (US$1.35) after trading in Hong Kong during the day at between HK$10.40 and HK$11.40. If the closing price is used, the value of the 27,387,097 shares is about HK$287.7 million.
CML Global Capital said it "will diligently pursue realization of the judgment," which "may be subject to an appeal by PCRD."
PCRD said it is "naturally disappointed" by the judgment, and confirmed its intent to appeal. Although PCRD said the judgment doesn't involve sums that are "material in relation to the company's net tangible assets," the company added that it "remains convinced of its position in this matter."
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