AgustaWestland has confirmed that it received a termination notice from the Indian Ministry of Defence yesterday on the VVIP chopper deal, along with a notification concerning an appointment of an arbitrator from its side, as requested on November 25 and December 4, 2013.
AgustaWestland claims that the contract termination notice by the Indian Ministry of Defence doesn’t offer adequate basis to take any action against the Company. Adding, February press release issued last year by the Indian ministry stated the tender process had been duly followed.
The company said that it will soon propose the names of the persons for the purpose of selecting the third arbitrator by agreement of the parties as requested by the Indian goverment.
AgustaWestland remains committed to working with the Government of India to resolve the issues, and is ready to perform the remaining obligations under the agreement for the supply of the 12 VVIP/VIP helicopters.
The firm will continue to support the three helicopters already delivered to and currently operated by the Indian Air Force.
The firm says that its parent company, Finmeccanica, has already introduced stringent ethical procedures common to all Group companies that have harmonized their systems of rules based on the standards set by the parent company.
AgustaWestland added that it is ready to take the necessary actions, to take necessary arbitration measures, included in a mitigation plan already prepared. “This plan includes a reduction to the workforce to readdress the company business model and the reallocation of existing working capital that will be reflected also on the supply chain. The completion of this plan, the positive company performance and the recent order intake will ensure a solid platform for revenues and cash flow streams,” the firm said.