Court ruling awaited on Jorf Lasfar sale

19 December 2003
A New York judge is expected to make a ruling in late December on whether Zurich-based ABBbroke a contract during its attempts to sell its 50 per cent stake in Morocco's Jorf Lasfar coal-fired power plant.

The plaintiffs, StealthEnergyCompanyand its subsidiary Luxembourg-based JLECAcquisition, claim that ABB had originally signed a $289 million deal with them for the sale of its equity position in the plant. According to the suit, ABB then raised its asking price to $355.6 million. ABB claims that an agreement with JLEC was never reached on the $289 million pricing.

The Jorf Lasfar plant, located 130 kilometres southwest of Casablanca, supplies 65 per cent of the kingdom's electricity. The other 50 per cent stake is held by the US' CMSEnergy, which, along with ABB, won a 30-year concession to operate the 1,356-MW power plant in 1997.

The Stealth-JLEC group, a consortium of Moroccan and international investors, has mandated Banque Marocaine du Commerce et Exterieure (BMCE) and Taylor-deJongh (TdJ)as its financial advisers. If a favourable decision is obtained in the New York court, it is expected that a $300 million debt and equity funding round will be launched, with BMCE focusing on the local debt and equity and TdJ working on raising international equity.

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