Canadian company Carmanah claims forces beyond its control were the reason for cancelling the acquisition.
Canada's Carmanah Technologies Corporation (TSX: CMH) claims in its statement of defense in the lawsuit with Israeli LED solutions developer Lightech Inc. that the reasons for cancelling the planned merger were beyond its control.
The companies launched legal proceedings against each other in January 2010, after Carmanah cancelled the acquisition of Lightech for $18.5 million. Carmanah paid a down payment of $312,000 at the signing, and placed an equal amount in escrow. When it cancelled the acquisition, Carmanah demanded the money back and sued Lightech in the Supreme Court of British Colombia. Lightech has countersued Carmanah in the Tel Aviv District Court for an alleged breach of the terminated merger agreement and is seeking $6 million in damages.
Carmanah decided not to hold an equity offering, which it claims was a precondition for it to acquire Lightech.
Published by Globes [online], Israel business news - www.globes-online.com - on April 6, 2011
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