Wireless and optical technology developer Arasor International (ASX:ARR) has won a court battle to wind up two Indian companies that have owed it money for over two and a half years.
An Indian court has accepted Arasor's petition to order the wind up of Xalted Information Systems and SemIndia Limited, Arasor revealed.
These companies had both acknowledged in August 2008 that they owed Arasor significant sums for orders received, but have yet to pay up.
Repeated visits by Arasor's chairman, debt collectors and Australian government group Austrade had failed to resolve the impasse, and Arasor decided to take legal action in March.
The two Indian companies had this year started to claim that the products they ordered had a high failure rate, and as a result customers ITI and UTStarcom had refused to pay them.
But Arasor said the companies had not mentioned such issues in the first two years after acknowledging the debt.
Arasor chairman Reg Bancroft said it is unclear whether the verdict will result in a recouping of funds in the near future.
“Unfortunately, neither company is in good financial health and it remains to be seen whether they are in a position to reach a settlement in the short term,” he said.
A similar third case, against Silk Tele Networks, is being compiled. Arasor has already written down the unrecovered funds from all three companies.
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