Keppel O&M served summons in new lawsuit by EIG

Keppel Corporation's offshore and marine (O&M) unit has been served with a summons in a new lawsuit filed by EIG Global Energy Partners and some of its managed funds in the United States.

The conglomerate maintained in a disclosure about the summons and the lawsuit after yesterday's market close that "the reported cause of action is without merit" and that its O&M unit "will vigorously defend itself".

An article published last Thursday on the Law360 website said the EIG funds had launched a US$660 million (S$873 million) racketeering suit in a New York federal court against Keppel O&M (KOM), pursuant to the Racketeer Influenced and Corrupt Organisations Act.

The civil suit concerns KOM's role in a Brazilian bribery scheme linked to a failed drill ship venture, for which Keppel recently reached a US$422 million settlement between KOM and the prosecutors in the US, the article said.

In 2016, Keppel Corp, KOM, Sembcorp Marine and Jurong Shipyard were added as defendants, along with other shipyards and entities, in the lawsuit filed by EIG and its eight managed funds with a district court in the US.

EIG had alleged in the 2016 lawsuit that it was misled by Petrobras, along with other named yards and entities, to invest over US$221 million of equity in Sete Brasil, a rig-building business unit of Petrobras.

Sete Brasil went on to award rig-building contracts valued at about US$10 billion to business units of KOM and SembMarine.

The US District Court, District of Columbia, subsequently ruled last year in favour of Keppel Corp, KOM, SembMarine and Jurong Shipyard and dismissed the lawsuit filed by the EIG funds.

A version of this article appeared in the print edition of The Straits Times on February 14, 2018, with the headline 'Keppel O&M served summons in new lawsuit by EIG'. Print Edition | Subscribe