Waste treatment plant operator Bioganix has settled its dispute with one of its local authority customers.
The shares jumped 10p to 105p, valuing the company at £8.52m. This is still well below the level at which Bioganix shares were trading six months ago.
The two parties settled just before the dispute was due to go to arbitration. The customer, which failed to deliver the required levels of waste, will pay £100,000 plus 12 monthly instalments of £10,000 each. The customer has also said that it will process material supplied by Bioganix at a reduced gate fee. Over two and a half years that could be worth £840,000 taking the value of the settlement to £1.06m.
The customer will also continue to delver waste to Bioganix’s plant under similar terms to previously. It has agreed to deliver a minimum of 26,000 tonnes of waste by August 2011.
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