Reliance Infrastructure has served an arbitration notice on founder-promoters of Pipavav Defence and Engineering Limited (PDEL), seeking indemnity of ₹5,440 crore for breach of warranties under a purchase agreement.
“Notice is issued for breach of warranties under purchase agreement by founder-promoters for acquisition of Pipavav Defence shares,” said a Reliance Infrastructure statement.
To claim loss
“The company has discovered that there have been serious breaches of warranties and representations made by the founder-promoters.
As per the share purchase agreement, we are entitled to claim the loss caused, in an arbitration,” a source in the legal fraternity told The Hindu. On March 4, 2015, Reliance Infrastructure, its subsidiary Reliance Defence Systems (RDSPL) and the founder promoters of Pipapav Defence and Engineering (Nikhil Gandhi and Bhavesh Gandhi) entered into an agreement for acquisition of shares of Pipapav Defence and Engineering, which was being named as Reliance Naval and Engineering Ltd (RNEL).
Mr. Nikhil Gandhi, also a promoter of SKIL Infrastructure Limited, could not be reached for his comment.
A spokesperson of Reliance Infrastructure, however, declined to share more details about the arbitration notice.
