You show your inexperience, djr.
Vendors only give warranties that are very specific and carefully thought through. They almost invariably relate only to the existence of assets acquired and title to them and the absence of liabilities not provided for, of which tax is the most commonly encountered . None ever relate to future performance unless there's an 'earn-out' involved - but that's only usually in smaller businesses where the vendor stays after the deal to help in the transition period relating to the management of the business.
And no warranties are ever given that cater for the inability of an acquirer to run a business properly after the vendor cedes control to the buyer and no longer has the ability to influence it in any material way. No warranties I ever came across provided for a buyer to have his money returned if conditions in the industry changed or there was a cataclysmic event such as an earthquake or maybe a comet colliding with the earth after the sale date. Osborne's declarations in late 2014 were the equivalent of an earthquake and materially affected attitudes to PI claims in the UK - a PI market multiples of the size of AU's - to the considerable detriment of companies like SGS, which is now looking for WTG to reimburse it for its losses in this regard.
The rest of the claim is about SGH's woeful inability to effectively run a complex, multi-dimensional business on the other side of the world, in a country it had limited experience of, that was twice it size, had all sorts of well publicised problems that SGH (Grech in particular) thought it understood but didn't. Grech was like a schoolboy in short trousers compared with what was needed, surrounded by 'yes' men filling their boots and puffing their chests out at being able to sit around the same table as Australia's latest business hero.
imo the claim is a diversionary tactic to muddy the water and steer the focus away from the real culprits for SGH's downfall, from which it can never recover. Grech was still telling the market 6 months after the deal was signed that everything was on track, ffs. You tell us why this was, djr because I'm baffled.
There are precedents. If you're interested, have a look at Hewlett Packard's acquisition of Autonomy in 2011 and what followed. HP, led by Meg Whitman made an unholy mess of an $11bn acquisition and HP wrote off $8bn in the first year, blaming Autonomy's founder, Mike Lynch for the same kind of things SGH is laying at WTG's door. The big write off was announced at the same time as those sharp enough to spot it would have noticed were about the worst results HP had ever produced, regardless of the write off. Whitman should have been sacked but wasn't because the big write off and the fraud claims were what the press liked. 5 years on and she's still there. I believe the case is due to be heard in 2018. I know who I'd back.
https://techcrunch.com/2016/12/05/fraudtonomy/
Maybe the above is how SGH got the idea? Hope it doesn't turn around and bite a modest second generation immigrant from a far away land cum Clark Kent look-alike - if I were him I'd make sure most of my assets were in the wife's name...............
Hang on a minute...........
all imho
dyor
make sure you do the right thing
let no-one have your shares
vote 'no'.....
'32 more pages deleted here'........mod
etc etc
