NOVEMBER 12, 2013 — St. Catharines, Ontario, headquartered Algoma Central Corporation says it has been advised that the Commercial Court in London, England, has rejected a request by Jiangxi Jiangzhou Union Shipbuilding Co. Ltd. seeking leave to appeal the Arbitration Tribunal decision regarding a shipbuilding contract dispute involving Algoma Tankers International Inc., a wholly owned subsidiary of Algoma.
"We are extremely pleased that the Court rejected the shipyard's request and confirmed that the decision of the Arbitration Tribunal would stand", said Greg Wight, President and CEO of Algoma. "We will reactivate the collection process that we began following the Arbitration Tribunal decision, and we fully expect that the collection of our deposits will proceed smoothly from this point."
In 2007, Algoma, through a wholly owned subsidiary, entered into contracts to build three 16,500 dwt product tankers in China. Each contract contained provisions that permitted cancellation under certain conditions. These conditions were met in 2010 and Algoma accordingly issued notices of rescission to the shipyard seeking to cancel the contracts, and demanding reimbursement of the installments that had been advanced. The matter was taken to arbitration by the shipyard and hearings were conducted before the Tribunal in London in September, 2012. The Arbitration Tribunal found in favor of Algoma in all matters on April 30, 2013.