(Reuters) - Canada-based Yamana Gold Inc said it would seek the annulment of an Argentine court-appointed arbitrator’s assessment that the company should pay $244 million to a director of Samco Gold Ltd.
Yamana’s Toronto-listed shares fell in the morning after Samco announced the court award, but they recovered after Yamana said it would “vigorously defend” against the claim.
Friday’s arbitrator’s award was related to a May 2013 judgment by the Argentinean Commercial Court of Appeals against Northern Orion Resources Inc, which Yamana had bought in 2007.
The court had decided in favor of Ricardo Auriemma, currently a Samco director, who had accused Northern Orion of breaching his rights to participate in the acquisition of an Argentine mine, Samco said.
The company had said a year ago that it would be the sole beneficiary of the judgment, according to its agreement with Auriemma.
Yamana, which has assets in Brazil, Argentina, Chile, Mexico and Canada, on Friday said the arbitrator’s assessment was a “gross miscalculation of the actual value”, and the company had identified significant errors in it.
The arbitrator had failed to follow court instructions and had used improper valuation methodologies, leading to an inflated assessment, the company said.
Reporting by Anet Josline Pinto in Bengaluru; Editing by Joyjeet Das