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Assetco takes legal advice after Lincoln council terminates contract

By BFN News | 03:01 PM | Monday 16 April, 2012

Assetco has taken legal advice after its vehicle and asset maintenance contract with Lincoln County Council was terminated. Assetco said that during the 18-months to the end of September the Lincoln contract accounted for £4.4m of the Company's total revenue of £49m. The contract is operated through a subsidiary, Assetco Lincoln Ltd, and in the 18 month period, it had net liabilities of £8.4m after bank debt of £10.01m; revenues of £4.2m; profit before tax and exceptional items of £0.11m; and a loss before tax and after exceptional items of £8.9m. The Lincoln contract also provides for payments from Lincoln County Council in the event of termination, which should result in the banks receiving payment for the relevant leased assets. But Assetco says as there does not appear to be a valid contractual basis for the termination, the company considers the action to be a repudiatory breach of contract and following legal advice it is reserving its position. At 3:01pm: (LON:ASTO) share price was -15p at 147.5p Story provided by

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