Lanco alleges overpayment of AUD 500 mn for an Aus mine

Lanco Infratech, the owners of Griffin Coal, has filed a petition against Australian advisory and investment firm Kordamentha in a Western Australian court alleging that latter misled it by withholding two important issues on the mine's capacity resulting in overpayment of USD 500 million (USD 382 million).
Though Lanco filed the petition in 2015, the proceedings on the case will start this month, sources said.
"Before the hearing in the court, reconciliation proceedings will start during this month," sources further said.
Lanco Infratech through its Australian subsidiary, Lanco Resources Australia, acquired Griffin Coal Mining Company and Carpenter Mine Management for AUD 740 million in March 2011. The sale process was overseen by Kodramentha - the administrator of Carpenter Mine.

"The hearing of the case is expected to come in March and the allegation was that Kordamentha has not given the right information with regard to the mines capacity when they are selling them to Lanco. The issue with Kordamentha is that they have not disclosed the reserves of the mines properly which resulted in overvaluation of the mines by about AUD 500 million," sources told PTI.
When contacted, T Adi Babu, the Chief Operating Officer of Lanco Infratech, refused to comment on the subject saying that it is sub-judice.

An email sent to Kordamentha was not answered. However, the Australian firm had earlier denied the allegation.

Lanco has so far paid about AUD 600 million and it was alleged that it is yet to pay about AUD 150 million to Kordamentha which is involved in a legal battle over the dues from the Indian firm.
Lanco alleged that Kordamentha misled the bidders by withholding two reports suggesting the Griffin coal deposits were smaller than disclosed first.
According to the latest annual report of Lanco, production at Griffin Coal mine during the 2015-16 was 2.45 MT with sales of 2.44 MT.
It incurred Rs 133 crore loss during the last financial year on income of Rs 500 crore from the mine, it said. The Australian miner is continuously making cash losses ever since its acquisition in 2011.