CSE Global agrees to US$8 million settlement with customer of subsidiary

Technology solutions provider CSE Global has agreed to a US$8 million settlement payment with the customer of its wholly owned subsidiary, Hankin Environmental Systems.

The settlement is expected to have a material adverse impact on the financial position of the company for the financial year ending Dec 31, 2024 as the company will record the settlement sum for the financial year.

The technology solutions provider said in a filing to the Singapore Exchange on Monday (Sep 9) that the customer had instituted arbitration proceedings in the US on Sep 3.

Hankin was engaged by the customer to perform certain engineering, materials procurement and installation services on a construction project in the US for which the customer was the general contractor.

The customer alleged in the arbitration proceedings that it had suffered losses due to Hankin’s delays in carrying out the contracted work.

However, Hankin claimed that the delays were predominantly caused by supply chain disruptions due to the Covid-19 pandemic and the customer’s instructions to vary the approved existing design plan.

The parties agreed to a “full and final settlement” of all claims asserted by the customer in the arbitration proceeding on Sep 8. The payment is subject to the execution of a written settlement agreement and release by the parties.

Shares of CSE Global rose 1.1 per cent or S$0.005 to close at S$0.47 on Monday, before the update.