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Hyundai Heavy says will take legal action against IPIC for Oilbank shares

Posted on: Thu, 26 Nov 2009 23:29:00 EST

Symbols: HYHZF

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SEOUL, Nov 27, 2009 (Asia Pulse Data Source via COMTEX) --
HYHZF | Quote | Chart | News | PowerRating -- Hyundai Heavy Industries Co. said Thursday it will take legal action against an Abu Dhabi-based firm that is refusing to sell shares in an oil refiner the South Korean shipbuilder wants to take over.

International Petroleum Investment Co. (IPIC), operated by the Abu Dhabi government, has rejected the validity of an International Chamber of Commerce decision recognizing Hyundai Heavy's right to buy Hyundai Oilbank Co.

IPIC said some key factual and legal conclusions of the ruling are incorrect and that it is not enforceable in South Korea, according to Hyundai Heavy.

"IPIC should accept the binding ruling," a Hyundai Heavy official said, "we will take legal action against it if it does not sell its Hyundai Oilbank shares (to us), and seek compensation from IPIC for the delay in implementing the ruling."

The oil investor acquired 50 percent of Hyundai Oilbank in 1999 and took another 20 percent in 2003 from Hyundai Group, which was trying to reduce its debt at that time.

Hyundai Heavy filed a petition with the International Court of Arbitration under the International Chamber of Commerce in early 2008, saying IPIC had breached a shareholder agreement by trying to unload its stake elsewhere.

On Nov. 16, Hyundai Heavy said the chamber ruled in its favor. The company currently owns around 20 percent in Hyundai Oilbank.

Under the ruling, IPIC should sell its stake back to the shipyard for 15,000 won (US$13) per share -- a transaction valued at around 2.6 trillion won.

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