CHS hit by foreclosure action

Failed buyout leads to claim for $42m

SiS International Holdings was braying for CHS Electronics' blood this week over claims that the distributor owed over $42 million for a buyout agreement. According to Reuters, the US distribution group said on Monday it had begun foreclosure proceedings against CHS. In February 1998, CHS had agreed to buy 80 per cent of SiS' distribution group SiS Distribution for $70.4 million. However, SiS claimed it was still waiting for CHS to cough up the remaining $42.24 million, which it has owed since March. In addition, the troubled Miami distributor failed to pay the balance to SiS even after a revised payment schedule had been banged out. SiS said it was legally entitled to the sale shares and had already started foreclosure proceedings. It added that it had not been damaged by CHS' lax payment because, by some bizarre foresight, it had not committed itself to invest the cash. The move followed revelations earlier this week that CHS was being investigated in the US over money laundering claims. ® Related Stories CHS losses unveiled in full Receivers called in at CHS Electronics UK

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