European Islamic Investment Bank Plc (EIIB) is seeking payment of its $78 million claim against Saudi investment firm Ahmad Hamad Algosaibi & Brothers Co. without a trial.
EIIB, which filed its claim on behalf of a group of other banks, sought the ruling from a London judge after Algosaibi admitted June 15 liability in another case where HSBC Holdings Plc (HSBA) and four other banks are seeking $250 million from the company. Algosaibi, which has defaulted on its debt, said there isn’t enough money to go around. (source)
“They would like to pay, but they are unable,” Ewan McQuater, Algosaibi’s lawyer, said at yesterday’s hearing. The company “is overwhelmed” by demands for payment, he said.
EIIB, a London-based lender whose deals comply with Sharia law, in March lost a bid to join the HSBC case before trial began. HSBC’s lawsuit stems from the largest Saudi default to come out of the credit crunch and includes claims by British Arab Commercial Bank Ltd., Arab Banking Corp. and Credit Agricole SA. (ACA) Algosaibi dropped its defense of the HSBC case after deciding it would probably lose if the 10-week trial continued.
Jim Courtovich, a spokesman for Al-Khobar, Saudi Arabia- based Algosaibi, declined to comment on EIIB’s request for summary judgment.
The company has said Maan al-Sanea, an Algosaibi family relation and founder of Saudi conglomerate Saad Group, wrongfully got about $9.2 billion of loans in Algosaibi’s name. The company is suing him in other jurisdictions. Litigation under way in the Cayman Islands could ultimately affect more than 100 banks that made loans to Algosaibi.
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