IT solutions firm ASG Group has begun legal proceedings against the Department of Environment, Land, Water and Planning (DELWP) after failing to reach an agreement on how much indemnity ASG is owed after terminating a contract.
DELWP told ASG it was making a strategic decision to adopt a new ‘whole of government’ model for its Enterprise Resource Planning (ERP) systems, and that its existing application implementation project has been terminated for convenience.
According to ASG, the State of Victoria is obliged to indemnify ASG for its liabilities and expenses due to the termination, but it has failed to negotiate an agreement relating to the amount of the indemnity, leading ASG to commence legal proceedings in the Victorian Supreme Court against the State of Victoria to help recover the full amount of its claim.
ASG has assured shareholders the proceeding won’t have a material impact on its profitability.
In other news, ASG has expanded its contract with an unnamed international construction and contracting group, which involves the transformation of the customer's Oracle applications across its operations in Australia and Asia Pacific to ASG’s ‘New World’ platform.
The new deal will commence in FY17 and will contribute its revenue growth in the next two years.
ASG already supplies this customer with a range of applications and infrastructure managed services.