North American Suzlon faces lawsuit for breach of contract

A breach of contract lawsuit was filed against Suzlon Wind Energy Corp., the North American arm of Suzlon, by wind turbine tower maker Trinity Structural Towers, Inc., a subsidiary of NYSE-listed Trinity Industries, Inc.

The lawsuit was filed in the District Court of Dallas County by Trinity Structural Towers, who said Suzlon Wind Energy failed to comply with its purchasing obligations for the former’s structural towers as indicated in a 2008 supply agreement.

Under the said contract, Suzlon Wind Energy was supposed to buy approximately $377.3 million worth of 80-meter wind towers manufactured on a scheduled basis through 2011.

The agreement was later on amended with an additional $123.8 million worth of wind towers and an extension of the delivery period through 2013.

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To date, Trinity Structural Towers has produced and delivered approximately $88.6 million worth of wind towers, and is now claiming that Suzlon Wind Energy breached its contractual obligations for 2010 to 2011 to buy the obligated number of wind towers for this period.

Parent company Trinity, based in Dallas, Texas, provides products and services to the industrial, energy, transportation and construction sectors. The company’s shares were trading at $30.05 apiece as of January 4.

Meanwhile, Suzlon Wind Energy reported receiving an order totaling 120 megawatts for a project in the western part of the United States, comprising of 57 units of its S97-2.1 MW model.

The project is expected to be commissioned during the last quarter of 2012, as foundation construction will begin at next year’s second quarter. According to the American Wind Energy Association, the project could deliver enough energy to power 36,000 homes. – Jhoanna Frances S. Valdez

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