Saudi-listed Red Sea Housing Services sues to recover $24.5M in US court

Published August 16th, 2016 - 04:00 GMT
OPI alleges regulatory restrictions on international fund transfer in foreign currencies for its failure to settle the payments. (LinkedIn/Red Sea Housing Services Company)
OPI alleges regulatory restrictions on international fund transfer in foreign currencies for its failure to settle the payments. (LinkedIn/Red Sea Housing Services Company)

Red Sea Housing Services Company (Ghana) Ltd, a fully owned subsidiary, in Houston, Texas, USA filed a legal case against OPI International Group Ltd, its associated subsidiaries and named Directors for the total value of $24,524,024, which represents the total receivables outstanding as per the Company books.

Red Sea Housing Services Company explained on Sunday the reason behind resorting to justice by saying that it has entered into two separate agreements with a subsidiary of OPI International Group Ltd. (OPI) in 2011 and 2014 to construct labor camps in Angola with the capacity to accommodate more than 600 tenants, whereby OPI has agreed to transfer the due installments to the accounts of Red Sea Housing in Dollars as stated in terms of the agreements.

At first, OPI has partially settled the due installments. However, OPI has recently failed to meet its obligations and transfer the owed installments to the Company account due to a certain alleged regulatory restriction on international fund transfer in foreign currencies.

The company has been exploring all possible options to repatriate the amounts owed from OPI, but it was unsuccessful to reach a mutual agreement to receive the due amounts.

Accordingly, the Company decided to pursue a legal action and seek enforcement of its security under the contracts in order to recoup the outstanding payments due and payable from OPI International Group and its subsidiaries.

It has accordingly appointed specialized legal counsels who are very much familiar in dealing with such legal cases.

According to the preliminary discussions with the Legal Counsels, the legal case is expected to last between 6-24 months and associated legal fees could reach $200,000.

The Company will also consider the allocation of appropriate provisions in accordance with the stipulated accounting standards against the outstanding receivables starting from Q3 2016.

Any further material information related to the progress of the legal case will be disclosed to the public in due course.

By Fahd Baqmi
 

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