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Legal Bun Fight Over VoIP Deal Escalates |
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Written by Adam Gosling
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Friday, 07 July 2006 |
The legal proceedings between IP Telephony softswitch developer, Transcom,
and Adelaid-based ISP, Chariot, heated up outside the courts this week as Transcom's
Queensland-based subsidiary accused the ASX-listed Chariot of misleading the market.
Chariot has issued a statement to the ASX denying the
allegations and reiterating that it intends to fight the Breach of Contract claims
in the Queensland Supreme Court.
A story in the Adelaide
Advertiser reported that Nav Basi, director of the Queensland-based
subsidiary of Transcom
International claimed Chariot's
failure to properly inform the market the two had restructured their deal has
led to the court action.
In a recent announcement to the Australian Stock Exchange, The
Adelaide-based ISP explained away the legal action saying: "The claims by
the Transcom companies arise from agreements between them and Chariot and the
termination of a wholesale distribution agreement under which certain products
and services were expected to be made available to the Australian
telecommunications market."
But Transcom director Nav Basi, didn't quite agree with that
assessment when approach by the Advertiser.
The two got into bed in late 2004 when Chariot invested $5
million to acquire a 37.74 per cent stake in the London-based Transcom
International and a further 80 per cent stake in the Transcom Australia
subsidiary as well as a licence agreement valued at $1 million.
The idea was to roll-out a VoIP telephony service in Australia.
Initially due for launch in late 2005, the two rescheduled the
start of the service for late 2005 citing technical issues. It never did appear
despite Chariot telling another news outlet in February this year that the
service was still in the works.
But Basi claimed that the agreement was restructured in late
2005, with Chariot abandoning its 80 per cent share of the subsidiary and licence
agreement instead agreeing to enter into a wholesale distributor agreement with
Transcom.
Navi claims the deal was restructured because Chariot did not
honour contractual obligations to fund and resource Transcom Australasia.
Consequently, Transcom International is seeking $3.2 million
from the ISP and is also making a claim against Chariot directors Peter Buttery
and Robert Horlin-Smith.
Chariot recently issued an EBITDA downgrade to the market
has increased its debt profile.
Chariot MD, Robert Horlin-Smith, told The Advertiser that the
restructure improved the company's debt position and indicated there could be another
restructure on the horizon which would seek to raise money to invest in Chariot's
wireless internet infrastructure.
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