(Bloomberg) --
The question of whether the coronavirus pandemic can be used to terminate an acquisition is set to get a first hearing in a U.K. court.
Activist Elliott Management Corp.'s Travelport unit, filed a lawsuit in London Monday to stop Wex Inc. from abandoning its $1.7 billion deal to buy a pair of travel-payments businesses. It said Wex breached the terms of its agreement and should be required to complete the purchase.
Panicked executives already have launched a handful of legal battles that could decide the fate of billions of dollars' worth of merger and acquisition agreements in the U.S. Travelport's suit is set to be the first case in the U.K. to consider whether the virus has had a “material adverse effect” on a transaction.
Travelport, which is owned by Elliott's private equity arm along with affiliates of Siris Capital Group LLC, is seeking a declaration from a judge that no “material adverse effect” occurred.
A representative for Wex didn't immediately return a call seeking comment.
L Brands, WeWork Fights Point to Pandemic Premium in Deals Ahead
Travelport said Thursday that the deal was executed on Jan. 24, after the virus had already begun to spread around the globe, and that the agreement “expressly excludes the effects of a pandemic from the definition.”
The pandemic has stifled global travel as people around the world have been told to shelter in place to stem the spread of the highly contagious coronavirus.
©2020 Bloomberg L.P.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
