Vietnam loss-making shipbuilding giant sued in London

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A Dutch company has filed a lawsuit in a London court, against Vietnam state-owned shipping giant Vinashin, and 21 of its Vietnamese subsidiaries.

According to a BBC report, the Commercial Court under the Court Queen's Bench on November 1 received a lawsuit filed by Elliott VIN Netherlands BV, a source from the court confirmed on Tuesday.

The content of the lawsuit will be confidential until the defendants confirm that they are being sued, the source said.

Observers said that the lawsuit could be about a loan of approximately US$600 million in bonds that Vinashin had borrowed from the UK-based hedge fund Elliott Advisors, which was supposed to be paid back in 10 semi-annual installments until 2015.

But the group missed the first principle installment of $60 million on December 20, 2010.

The creditor said it would sue the shipbuilder, according to a Financial Times report on October 17, which cited the global debt news online publisher Debtwire.

Local investigators are looking into the financial management of Vinashin, which nearly went bankrupt last year after piling up debts of US$4.5 billion.

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The Elliott lawsuit, according to the Debtwire report, could put more pressure on the group's restructuring efforts.

As of June 2011, Elliott Advisors had asked other Vinashin creditors to join in the lawsuit but then changed its mind.

Another Debtwire report in May said that while a London court order cannot be carried out in Vietnam, the foreign creditors can intervene in overseas loan transfers and make it impossible for Vinashin to do business abroad.

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