Sapphire Minmetals aims to expedite $2 billion lawsuit against Glencore, chairman says

By Reuters News

By Pratima Desai

LONDON, Sept 28 (Reuters) - Trading firm Sapphire Minmetals and related companies plan to move swiftly with their $2 billion lawsuit against Glencore after a Singapore court appointed KPMG as interim judicial managers of Radiant World, Chairman Rakesh Sethi told Reuters.

Radiant World, Sapphire Minmetals and other related companies filed a claim two weeks ago in Singapore's High Court, seeking damages from London-listed Glencore GLEN.L over allegations of fraud, breach of contract and conspiracy.

Glencore has described the claims as "meritless".

Last week, a Singapore High Court judge said interim judicial managers were needed at Radiant World to investigate suspected fraud at the iron ore trader, according to a court document seen by Reuters.

"We have reviewed the Court's decision concerning the appointment of interim judicial managers for Radiant. We are pleased that the Court declined to appoint nominees from Deloitte, which is Glencore's own auditor," Sethi said in a statement.

"Our claims against Glencore continue. We intend to pursue the proceedings on an expedited basis, and the truth of the trading relationship, including why Glencore has suspended the senior executive who ran it, will be established at trial."

Glencore recently suspended its head of iron ore trading Peter Hill, Bloomberg reported earlier this month.

Glencore declined to comment.

Sethi did not give details on how Sapphire, Radiant and the other claimants plan to accelerate their lawsuit.

GLENCORE TO CONTEST ALLEGATIONS

"Radiant World and Sapphire Minmetals have alleged that they have claims against Glencore for substantial amounts. These claims are meritless and we will contest them vigorously," Glencore said in a statement on September 15.

"We have incurred losses and been exposed to risks by Radiant World companies and will take appropriate action."

The Singapore court appointed KPMG as interim judicial managers of Radiant World after creditor Mizuho Bank 8411.T withdrew its bid to have rival Deloitte take the role.

The judge said interim managers were needed to restore "some degree of external confidence" in Radiant World after financiers and trading counterparties froze accounts, issued demands and withdrew from commercial relationships.

Radiant World has faced mounting challenges since banks and counterparties began distancing themselves amid concerns that invoices submitted to banks may not have been valid.

Mizuho provided about $100 million in credit to Radiant World in June, secured by invoices that a counterparty later said were invalid, Reuters reported earlier this month, citing documents and a source with direct knowledge of the matter.

The bank filed a case against Radiant World in Singapore's Supreme Court in August. Radiant World has not responded to requests for comment on the allegations.

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