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Lotus denies liquidation claims

Sports car maker Group Lotus has insisted that media claims that it is to go into liquidation are incorrect and the result of a procedural glitch at the Companies Court. On Monday 18th March Group Lotus PLC was one of the names on the Companies Court winding up list. This led to widespread industry speculation and media reporting that the company's creditors were seeking to have its assets liquidated in order to recover debts.

Sports car maker Group Lotus has insisted that media claims that it is to go into liquidation are incorrect and the result of a procedural glitch at the Companies Court. On Monday 18th March Group Lotus PLC was one of the names on the Companies Court winding up list. This led to widespread industry speculation and media reporting that the company's creditors were seeking to have its assets liquidated in order to recover debts. In a move to quash the rumours however, Lotus released the following statement on its website:
 
"Contrary to rumours initiated by Autocar magazine, Lotus is not being liquidated. Earlier this year, Lotus was in a contractual dispute which was resolved amicably a number of weeks ago. However the High Court process meant that the matter was still shown on the High Court website, as there was a hearing scheduled for today. This is what appears to have been seen and misunderstood. The case was only listed for the proceedings to be disposed of. The claim has now been dismissed with no order as to costs." Group Lotus is owned by the Malaysian company DRB-HICOM, which bought it when it took over Lotus' previous owner, Proton, in January 2012.
 
The court mix up comes after a difficult 2012 for the Norfolk car maker. In May of that year the firm's chief executive, Dany Bahar, was suspended from his post following claims of irregularities in his expenses. Bahar was dismissed from the company the following month. In August 2012, Lotus announced that the former chief executive was pursuing a £6.7 million claim against them for unfair dismissal. In October last year it was widely reported that the company owed suppliers some £23 million and concerns were raised about a winding up order. It seems that the current court procedures were a result of one of those supplier issues.
 
In February this year it was announced that Mr Bahar's £6.7m claim will be heard at the Queen's Bench Division of the High Court in London during June 2014. The former Lotus chief executive claims that he was unfairly sacked before the sale of the company which would have earned him 5% of the sale price. He claims that the company decided to go back on this deal and then made unsubstantiated claims against him to justify his sacking. Group Lotus and parent company DRB Hicom have declined to comment on the details of the case but insist that they will 'vigorously contest' the action.
 

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