Australian Unity has found itself in a legal dispute with the Calliden Group over the sale to Calliden of the general insurance business of Australian Unity.
Calliden has notified the Australian Securities Exchange (ASX) that it has issued proceedings in the Commercial Division of the Supreme Court of NSW against Australian Unity over a dispute involving the post-completion adjustment of the purchase price.
Calliden is arguing that the share sale deed it entered into with Australian Unity provides for an adjustment in the purchase price if the combined net tangible assets at the date of completion is different to those upon which the purchase price was based and provides a procedure for the calculation of the combined net tangible assets at the date of completion.
Calliden told the ASX today it believed it had complied with the procedure thus far and that the procedure should continue.
It said based on actuarial advice it has received to date, it believes that the purchase price should be adjusted in its favour by between $3 million and $4 million.
Calliden said Australian Unity did not agree with its position, disputed Calliden’s interpretation of the relevant provisions of the deed and had refused to continue the procedure of calculating the adjustment in purchase price.
