Feb 7 (Reuters) - Cooper Industries CBE.N, a maker of electrical products for utilities, manufacturing and other markets, said it would pay about $307.5 million towards a trust to settle asbestos-related claims with Pneumo Abex LLC.
The settlement resolves a lawsuit filed by Pneumo Abex challenging a joint venture between Cooper and Danaher (DHR.N) related to the companies’ rights and obligations under a mutual guaranty agreement.
A Cooper unit had guaranteed to fulfill certain obligations to Pneumo Abex relating to asbestos-related personal injury claims.
Asbestos, once widely used in manufacturing, has been partially banned by the U.S. government after it was proven to cause cancer, often in people who were exposed by breathing in asbestos particles.
Under the terms of the settlement, Cooper’s subsidiary will pay about $307.5 million to a settlement trust, while Pneumo Abex’s parent and one of its affiliates will contribute $5 million to the trust and $15 million to Pneumo Abex.
Pneumo Abex will continue to resolve asbestos-related claims asserted against it, and the settlement trust will indemnify Pneumo Abex and Cooper with respect to asbestos-related personal injury claims.
Cooper said it will incur a pre-tax, non-cash gain after adjusting its estimated net liability recorded for its obligations under the guaranty with the amount payable under the settlement agreement. (Reporting by A.Ananthalakshmi in Bangalore; Editing by Jarshad Kakkrakandy)