CSR joins James Hardie in cutting deal over leaky NZ schools
By Paul McBeth
Jan 28 (BusinessDesk) - CSR, the ASX-listed building products maker, has reached a confidential settlement with New
Zealand’s Ministry of Education over leaky schools, seeing off the need for legal action.
The ministry, which oversees education policy and spending, has discontinued its legal action against CSR Building
Products, a local subsidiary of the Australian firm, after settling the claim, Associate Education Minister Nikki Kaye
said in a statement. Details of the settlement will remain confidential.
The ministry filed the proceedings last year as it embarked on a remediation programme on 800 buildings across more than
300 schools, with an estimated cost of some $1.5 billion.
“While the CSR product is only on a small number of schools, I’m very pleased to see the industry responding sensibly
and allowing settlement to be reached without the need for court action,” Kaye said. “Effective legal action will
continue as needed to protect Crown assets, but it is only part of a much wider strategy to ensure delivery of the best
possible learning environments for students and teachers.”
When CSR was named as a party in the suit, it talked down its role saying its low level of market share of the product
meant “any potential financial impact related to this action would not be material to the financial results of the
company.”
CSR’s shares were unchanged at A$2.90 on the ASX in early trading today.
The settlement is the second in as many months, after James Hardie cut a deal just before Christmas, having it faced
potential costs of up to US$47.6 million related to a slew of leaky building claims, including provision of US$15.2
million for the ministry’s NZ$1.5 billion suit against cladding manufacturers.
At the time, James Hardie said its settlement won’t have a material adverse impact on its business result, which would
see the company support the ministry’s remediation programme and support future property development around New Zealand.
The ministry is continuing its legal action against Carter Holt Harvey.
(BusinessDesk)