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Telkom, Blue Label put Multi-Links battle to bed

10th December 2014

By: Natasha Odendaal

Creamer Media Senior Deputy Editor

  

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Telkom and Blue Label Telecoms have ended the drawn-out arbitration proceedings and litigation between their respective subsidiaries after withdrawing their claims and counter claims.

The parties agreed to settle their disputes on the basis that all claims and counterclaims were withdrawn, with no potential for further related claims, with each party responsible for their own legal costs.

“In terms of the settlement, all the parties have agreed to withdraw all allegations of any wrongdoing, which they made against each other in the course of advancing their various claims, counterclaims and defences,” Telkom and Blue Label said in their respective statements.

In 2011, Blue Label subsidiary Africa Prepaid Services Nigeria (APSN) instituted arbitration proceedings against Telkom’s former subsidiary Multi-Links Telecommunications, after a ten-year distribution agreement dissolved.

APSN cancelled the then-two-year-old contract in 2010 on the basis of Multi-Links’ “wrongful” repudiation of the agreement, which tasked APSN with the distribution of Multi-Links’ products and services in Nigeria.

APSN’s $457-million claim against Multi-Links was countered by claims of $123-million against the Blue Label subsidiary.

Telkom and Multi-Links further obtained a stay of the arbitration proceedings and instituted an action in the High Court against Blue Label, APSN and certain individuals, including Telkom executives, for payment of $528-million and $196-million respectively.

APSN counterclaimed against Telkom and Multi-Links for payment of $457-million in the action.

Telkom sold its shareholding in Multi-Links to Hip Oils in October 2011; however, in terms of an indemnity contained in the sale agreement, Telkom remained liable for all claims above $10-million.

Edited by Creamer Media Reporter

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