Allen & Overy LLP, the U.K.’s third most profitable law firm, sued Nimbus Communications Ltd., claiming the Indian media company failed to pay some of its legal fees after delaying its initial public offering.
Nimbus’s lawyer Chandra Mohan said yesterday that the parties are in negotiations. The London-based law firm is seeking $226,490 from Nimbus for breach of contract, according to its lawsuit filed with theSingapore High Court in February.
Allen & Overy — through its former Singapore joint law venture with Shook Lin & Bok LLP — was the legal adviser to Deutsche Equities India Pte and Edelweiss Capital Ltd. (EDEL) on the proposed share sale. Nimbus was required to pay all legal fees related to the IPO whether it was completed or not by Nov. 30, 2007, according to the lawsuit.
While Mumbai-based Nimbus has paid Allen & Overy $150,000, an agreed fee cap was voided after the company missed deadlines to file its draft prospectus to the Indian regulator and complete the share sale, according to court filings. The law firm’s fees ranged from $180 an hour for a paralegal to $675 for a partner.
Nimbus hasn’t filed its response, Mohan said. Ken Aboud, Allen & Overy’s managing partner in Singapore, declined to comment on the lawsuit.
At least 95 companies have pending draft offer documents with India’s regulator seeking approval for share sales. Indian companies have raised about 267 billion rupees ($6 billion) in domestic share sales this year, less than half the amount they collected in the same period in 2010.
Nimbus, which posted a loss of 1.4 billion rupees in the year ended March 31, 2010, plans to sell 22.1 million shares at an undisclosed price, according to its draft prospectus dated Sept. 29 last year.
3i Group Plc (III), U.K.’s largest publicly traded buyout firm, Cisco Systems Inc. (CSCO) and Oman Investment Fund in 2007 agreed to invest $125 million in Nimbus, which broadcasts cricket and other sports events in India.
Edelweiss, Macquarie Capital Advisers (India) and Centrum Capital Ltd. (CECA) are listed in the draft prospectus as the lead managers for Nimbus’s planned listing.
The case is Allen & Overy LLP v Nimbus Communications Ltd. S101/2011 in the Singapore High Court.
To contact the reporter on this story: Andrea Tan in Singapore at atan17@bloomberg.net
To contact the editor responsible for this story: Douglas Wong at dwong19@bloomberg.net
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