Israeli firm sues French partner for JV pullout, raises possible link to the Arab boycott
A recent court filing in the US against VINCI Airports US Inc., a local subsidiary of French VINCI group, suggests the Arab Boycott may be gaining momentum with European corporations.
VINCI was quick to recognize the immediate and pressing need for increased airport security in the aftermath of the September 11 attacks. Therefore, in September 2001, VINCI acquired the US-based Worldwide Flight Services Inc., which provides cargo and passenger handling services, including security services, to more than 300 airlines and airport authorities in over 100 locations in the US and around the world.
According to Menareport.com, VINCI Airports US entered into a strategic joint venture with Israeli company, SpaceLogic Ltd., to provide much-needed airport security systems. SpaceLogic, an Israeli producer of airport baggage handling systems, had just completed the development of a breakthrough security system for airports that dramatically increases the level of baggage security at airports.
On February 14, 2002, SpaceLogic and VINCI signed the joint venture agreement, forming a new company known as SecureHandling, Inc. to develop and market SpaceLogic’s proprietary solution.
A court suit, filed by SpaceLogic, claims that on June 11, 2002, without basis or warning, VINCI unilaterally withdrew from the joint venture. As court proceedings commence, SpaceLogic is investigating the possibility of a link between VINCI’s joint venture pullout and the resurging Arab boycott.
VINCI Airports US Inc. is a subsidiary of French company VINCI, one of the world's leading companies for concessions, construction and associated services. Paris-based VINCI has conducted extensive business dealings across the Middle East for many years. Its projects include Baghdad’s sewer system, a large-scale project that VINCI completed in the 1980s.
On June 1, 2002, 10 days before VINCI’s US subsidiary abruptly withdrew from its joint venture with Israel’s SpaceLogic, VINCI signed a major new contract with the Egyptian government, Menareport added. The deal, worth €225 million, was soon followed by another contract to the tune of €28 million.
Claiming the “blatant breach of agreement” caused them significant damages and missed opportunities in the current marketplace for airport security systems, including a mission-critical project at New York’s JFK Airport, Israel's SpaceLogic filed suit in the New York Civil Court for a sum of over $50 million. — (Albawaba.com)
© 2003 Al Bawaba (www.albawaba.com)