Shaft Sinkers hit by EuroChem claim

Underground construction group Shaft Sinkers sank to a new low after being hit by a double-whammy.

First, the company revealed work at the Moab project in South Africa has been interrupted pending resolution of the unprotected strike, although it added that its work under this contract is substantially complete and the revenues outstanding do not represent a material proportion of the company's 2012 order book. Nevertheless, management is conscious that the general operating environment in South Africa continues to be difficult and will continue to monitor the impact of this on its wider business.

Of more serious concern was the filing of a claim against the company by EuroChem in relation to the project the two companies were working on, which was terminated with effect from April 20th 2012.

Try 6 free issues of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up for MoneyWeek’s free twice-daily newsletter.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Sign up

Shaft Sinkers said it has not yet received notification of the arbitration claims but believes that any such claims are without merit and will contest them robustly. Shaft Sinkers is finalising its claims against EuroChem arising out of the termination of the contract and will pursue these claims against EuroChem.

JH