GE Comments on Suit by Former Panametrics Principals
April 15, 2003--A law firm representing two former majority owners of Panametrics, a company that GE Power Systems acquired in 2002, issued a news release yesterday announcing that the shareowners were filing suit against GE alleging that GE used tactics to improperly reduce the agreed-upon purchase price that GE paid for Panametrics. GE Power Systems responded to media inquiries saying, the allegations in the complaint are meritless, and made the following points:
-- The sellers are improperly seeking to make a Federal case out of a routine commercial dispute.
-- This was an intensely negotiated business acquisition. As in most such acquisitions, the parties' detailed contract provides for post-closing adjustments to the purchase price to reflect the final valuation of the assets and liabilities of the company. GE is seeking a price adjustment of precisely the kind provided for in the contract, based on an audited closing balance sheet prepared by independent outside accountants.
-- Both parties were represented by experienced lawyers and other professional advisors on the items subject to a post-closing adjustment.
-- This commercial dispute will be properly resolved before an accounting referee as provided in the contract. GE will not receive a purchase price adjustment unless that neutral third party decides in GE's favor.
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