Telkom will pay US$80m (R604m) to settle its nine-year long legal wrangle with Telcordia Technologies.
In 1999, Telcordia signed a contract with Telkom to supply a customer-care solution to SA’s fixed-line business.
Telkom terminated the contract two years later, saying the US-based business was in breach of contract by not providing the product to the agreed specifications.
The dispute was taken to arbitration in 2001 and Telcordia demanded a claim of $128m. The arbiter awarded Telcordia part of the amount, which Telkom then took on appeal.
Both the Pretoria High Court and the Supreme Court of Appeal upheld Telcordia’s claim.
The dispute was finally settled on Tuesday and Telkom will pay out the $80m dictated by the arbitration ruling.
In a statement to shareholders on Thursday, Telkom says it provisioned $77m in its previous financial year to cover the expected payout. — Staff reporter, TechCentral