(Alliance News) - Tanfield Group PLC on Tuesday said Snorkel International Holdings LLC and SKL Holdings LLC have filed a summons and complaint in the US against the company.
Shares in Tanfield were down 10% at 4.50 pence in London on Tuesday afternoon.
Tanfield has a 49% stake in Snorkel under its joint venture with Xtreme Manufacturing LLC, Xtreme owns SKL and is itself owned by Don Ahern of Ahern Rental Inc.
In November 2018, SKL exercised a call option for Tanfiel's Snorkel interest at an option price of nothing. SKL also claimed it did not have to pay the priority amount and preferred return on the Snorkel stake.
Tanfield disagrees and "rejects the validity of the purported call option notice". It claims to have attempted "to resolve the dispute amicably". However, Tanfield has been sent a copy of a summons and complaint bought by Snorkel and SKL and filed in the District Court of Clark County, Nevada.
SKL and Snorkel, according to Tanfield, allege that Tanfield "has refused to comply with its contractual obligations in relation to the purported call option correspondence".
Tanfield said its board "continues to seek advice and will vigorously defend its position as well as providing further updates to shareholders as and when appropriate."
By Anna Farley; annafarley@alliancenews.com
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Tanfield (TAN)