GS Engineering Falls Most in Six Months on Lawsuit: Seoul MoverKyunghee Park
GS Engineering & Construction Corp. fell the most in six months in Seoul trading after the South Korean builder said it was sued by a group of investors over losses caused by unexpected cost increases on overseas projects.
GS Engineering dropped as much as 4.8 percent, headed for the biggest decline since April 15, to 35,400 won and traded at 36,050 won as of 12:35 p.m. South Korea’s benchmark Kospi index rose 0.3 percent.
Fifteen investors filed the lawsuit against GS Engineering on Oct. 8 at the Seoul Central District Court, the Seoul-based company said in a regulatory filing today. The investors claim GS Engineering failed to make proper estimates in financial statements for costs that may arise from the projects, according to today’s statement. The builder said in April it expects an operating loss this year because of the cost increases.
The company said it will appoint a lawyer to handle the case.
GS Engineering in April reported an unexpected operating loss in the first quarter because costs increased for some of its overseas environment-related projects. That caused shares of builders to slump on concerns that other construction companies may face similar problems.