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Australia's Bradken to appeal court decision on "bid rigging"
March 20, 2013 / 12:51 AM / 5 years ago

Australia's Bradken to appeal court decision on "bid rigging"

SYDNEY, March 20 (Reuters) - Shares in Australian engineering firm Bradken Ltd dropped almost 5 percent on Wednesday after a court ruled against the company in a landmark “bid rigging” case involving the sale of a Canadian mining services company.

Bradken said it planned to appeal Tuesday’s decision by the Federal Court in Melbourne, which ordered the company to pay $22.4 million in damages.

Bradken was taken to court in the first test of an Australian law introduced in 2010 that broadened competition law to include bid rigging over a private equity deal involving the purchase and sale of Canada’s Norcast Wear Solutions in a single day.

The case has been brought by the owner of the takeover target, Swiss-based private group Pala Investments, which is controlled by a Russian oligarch, Vladimir Iorich, against Bradken.

Pala sold Norcast in July 2011 to New York-based buyout firm Castle Harlan Inc for $190 million. Seven hours later, Castle Harlan sold the firm to Bradken, a competitor of Norcast, for $209 million.

Lawyers for Bradken had argued there had been no agreement with Castle Harlan to on-sell Norcast.

A Pala spokesman said the company was “delighted with the outcome.”

Bradken shares were down 5 percent A$6.81 at 0020 GMT. The stock has dropped 14.5 percent since the Norcast deal.

Reporting By Maggie Lu Yueyang and Jane Wardell; Editing by Stephen Coates

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