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MURRAY & ROBERTS HOLDINGS LIMITED - Bombela Concession Company receives quantum award in the Gautrain Sandton Station "Cavern" arbitration

Release Date: 04/03/2016 07:17
Code(s): MUR     PDF:  
Wrap Text
Bombela Concession Company receives quantum award in the Gautrain Sandton Station "Cavern" arbitration

MURRAY & ROBERTS HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1948/029826/06
JSE Share Code: MUR
ADR Code: MURZY
ISIN: ZAE000073441
(“Murray & Roberts” or “the Company”)

BOMBELA CONCESSION COMPANY RECEIVES QUANTUM AWARD IN THE
GAUTRAIN SANDTON STATION ‘CAVERN’ ARBITRATION

Shareholders are referred to the previous statements released on the Stock Exchange News
Service of the JSE Limited (“SENS”), specifically in the Company’s bi-annual financial results
announcements, regarding the Gautrain Sandton Station ‘cavern’ arbitration (“Gautrain
Sandton Station Cavern Claim”) proceedings between the Bombela Concession Company
(“BCC”) and the Gauteng Provincial Government (“Province”). The Gautrain Sandton Station
Cavern Claim was lodged by the Bombela Civil Joint Venture (“BCJV”), which was
responsible for the design and construction of the entire Gautrain system (including the
cavern), through BCC, which operates the Gautrain system under a concession agreement,
against Province.

BACKGROUND

Murray & Roberts (45%), Bouygues (45%) and SPG (10%) are the shareholders of BCJV in
the percentages indicated. The construction of the Gautrain Sandton Station was tendered
as a ‘cut-and-cover’ design. However, the design was subsequently changed under a
variation order issued by Province to a ‘cavern design, which attracted additional costs. This
is the basis on which BCJV claimed for additional cost, and BCC pursued the arbitration
against Province as the concession company for the difference in the cost of the two
construction designs.

ARBITRATION AWARD

The Gautrain Sandton Station Cavern Claim, on its merits, was ruled in favour of BCC in
October 2013. On 2 March 2016, the arbitration tribunal announced the provisional quantum
award of R354 million.

The amount due must be finalised by escalating the value of the award from the date on
which the costs were incurred to the date on which the award was issued, based on its
constituent parts of Rands and Euros. Province is liable for all arbitration costs related to
this matter and has to pay interest at the prime overdraft rate plus 2% from the date of
finalisation of the amount due.

CONCLUSION AND REMAINING GAUTRAIN PROJECT CLAIMS
The Company is satisfied with the outcome of the proceedings and it further strengthens our
confidence in the Company’s entitlement with respect to unresolved claims on the Gautrain
project due for resolution. Details of these remaining claims were disclosed in the Group’s
interim results announcement released on SENS on 24 February 2016. These claims will be
diligently pursued and stakeholders will be kept informed as to their progress.

Bedfordview
4 March 2016

Sponsor: Deutsche Securities (SA) Proprietary Limited

Date: 04/03/2016 07:17:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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