Stock exchange operator NZX is apparently worried that it may have been sold a pup in its 2009 purchase of the Australian Clear Grain Exchange, and it has filed a lawsuit alleging breach of warranty.
The High Court lawsuit is against Ralec Commodities, Ralec Interactive, Grant Thomas, Dominic Pym and other related parties and concerns claims under the October 5, 2009, sale and purchase agreement.
NZX said today that the claims of breach of warranty were made to protect its commercial interests.
The amount of the claim was not given, but NZX chief executive Mark Weldon said when the deal was signed that the initial purchase price was $A6.4 million ($NZ8.26m at today's exchange rate) in cash.
"If significant trading volumes are achieved over a three year period, the increasing value of the grain platform will be recognised and an additional payment made," he said.
That purchase of the Clear Group covered Clear Commodities, the Clear Grain Exchange and Clear Interactive, the technology developer of the Clear Grain Exchange.
Clear Grain Exchange was the Australian grain industry's only full-service electronic market for the trading of grain, and provided provides a full suite of back office, settlement and payment services.
Last year Mr Weldon said that moving into commodities was good for the NZX company because risk management products, including futures, had shown consistently high activity levels and volume growth in recent years.
Last year, Clear Grain said it had more than 65,000 metric tonnes of grain on offer, and said more than 3000 Australian grain growers were actively using the exchange.
NZX separately owns ProFarmer - an Australian grain market data business - and NZX Agrifax, Dairy Week and eight Agri-Media titles including Farmers Weekly.
