Dinesh Paliwal, member of the group executive committee of ABB has just been elected chairman of ABB India. He left the country in 1980 to do a Master's in applied sciences and engineering in Miami University, US. He went on to join ABB and has been with it for over 18 years.

ABB Limited is a asbestos defendent based in Switzerland with 94, 000, 000 claims as of March 31, 2002 with an estimated asbestos liabilities of 94, 000, 000 dollars and insurance recoveries of 150, 000, 000. It has a net revenue of 23, 726, 000, 000 dollars, an asset of 32, 344, 000, 000 dollars, a liability of 30,155, 000, 000 dollars and net income loss of 130, 000, 000 dollars with 156, 865 employees.

According to a 9th January, 2004 news report, an appeals court in the United States has again delayed a hearing on an asbestos settlement involving this Swiss-Swedish engineering group, ABB. The hearing, originally due for December, had been set to take place next month, but was rescheduled for technical reasons. ABB said it was confident that the $1.2 billion deal, approved by lower courts, would be confirmed. The settlement is to cap potentially ruinous claims and is part of ABB's turnaround strategy. The company plans to sell off most of its oil, gas and petrochemicals unit in a bid to cut debts.

Birmingham Post reported on January 27, 2004 that shares in Swiss engineering group ABB - which has a number of subsidiaries in the West Midlands - fell some three per cent after chairman and chief executive Juergen Dormann issued what some analysts saw as a veiled profit warning.

ABB, which has subsidiary firms in Birmingham, Burtonupon-Trent, Coventry, Derby, Stone and Telford, lost almost $800 million in 2002. Analysts had expected a lower loss in 2002 – up to $500 million – as an improvement in its core businesses was not seen as enough to offset weakness in some units being sold and losses on disposals. The firm lost $379 million in the first nine months of the year. Since then it has announced the sale of its reinsurance business with a book loss of $150 million. The firm reports 2003 results on February 19.

ABB is confident that the Pennsylvania-based Third Circuit Court of Appeals would accept its settlement at a date to be determined. The asbestos settlement in the US centres on ABB’s bankrupt Combustion Engineering unit, which made industrial boilers insulated with asbestos material.

If accepted, the deal would settle the vast majority of claims made by more than 100,000 people suffering from the effects of asbestos. Thirteen claimant groups have lodged appeals against the company’s plans. The original hearing, set for the middle of December, has now been delayed for the third time.

An ABB spokesman said that the delay would have no impact on the firm’s sale of most of its oil, gas and petrochemicals unit for up to $975 million.The sale is considered a vital part of the company’s effort to cut its mountain of debt, built up after an overambitious acquisition strategy. The firm had originally wanted to reduce its $8.3 billion pile of debt to about $6.5 billion in 2003.

Chairman and CEO Jürgen Dormann, acclaimed for helping to save ABB from the brink of bankruptcy in 2002, said an interview that he expected the asbestos issue would be finalised in the first or second quarter. ABB aims to return to profit this year after a loss in 2003. In a related development, the head of ABB Switzerland, has said that the sale of the Swiss building systems unit should be completed this year. Most of the unit, which generated $2.4 billion in sales in 2002, has already been sold.

During 2003 the Republican leadership had promised to curb the authority of state courts to hear class-action lawsuits, and negotiate a national settlement to billions of dollars in asbestos claims. Senate Democrats blocked efforts to conclude a national settlement of asbestos claims was blocked by big labor in the waning days of 2003. Legislation on class-action lawsuits and the national asbestos settlement have a good chance of passage before the 2004 election-year begins.

It has been almost two decades since asbestos manufacturers, distributors and their insurers publicly recognized the legal and economic significance of asbestos claims. Yet the asbestos problem seems to be growing based on the number of claims pending - claims totaling into the tens of billions of dollars. Familiar names including Owens Corning, USG, W.R. Grace & Co., Armstrong World Industries and Federal-Mogul Global are among dozens of public and private companies that have been forced into bankruptcy by asbestos claims.

Sources say, work is on an accommodation with Senate Democrats regarding the asbestos settlement, a deal that creates a trust fund to pay settlements on bona fide claims but does not require the assent of the labor unions, particularly the AFL-CIO. Before the Congress went home for the holidays, an industry group representing insurers and manufacturers offered to create a fund totaling more than $113 billion, but labor reportedly held out for a figure closer to $150 billion, which was unacceptable to the manufacturers and insurers who are paying the freight.

Don Barrett, one of the nation's leading litigators, whose firm is involved in several asbestos cases, thinks there simply are too many strongly competing issues and constituencies involved in the thousands of asbestos lawsuits now pending around the country ever to reach an accord.

Barrett is not the only observer, liberal or conservative, with doubts about the fate of the asbestos settlement. Indeed, the skepticism regarding a national settlement of asbestos claims has caused a number of large public companies to cut their own deals.

Halliburton, for example, is moving ahead with a plan to reorganize its Industries, Kellogg Brown & Root and other affected subsidiaries under the protection of the U.S. bankruptcy code. More than 20 insurance companies want a judge to dismiss the Halliburton bankruptcy, which is a key part of the company's $4 billion settlement of all current and future asbestos claims. The insurers argue that a financially healthy company such as Halliburton should not be allowed to use bankruptcy to gain a tactical advantage in litigation against asbestos claimants.

Other large manufacturers such as ABB, Hercules and Congoleum, and insurance companies including Travelers, likewise have negotiated their own agreements. "The rate of private settlements slowed noticeably in 2002 when corporate executives thought that a national settlement was likely to pass the Congress," says Bill Rochelle, a bankruptcy lawyer at Fulbright & Jaworski in New York City. But Rochelle now sees the rate of private settlements of asbestos claims accelerating as the chances for passage ebb and the November 2004 elections approach. "Companies need certainty and the negotiations have gone on for too long," he adds.

The analysts believe that ABB"s balance sheet would strengthen, once the company completes its divestment transactions and closes its asbestos related disputes.
Paliwal was elected to the group executive committee in 2001, at a time when ABB was going through perhaps its toughest time ever. A class action lawsuit centred on ABB's Combustion Engineering unit in the US had almost brought the company to its knees. The unit made industrial boilers insulated with asbestos, a material known to cause deadly disease. Things are now improving for ABB, with the asbestos issue seemingly close to resolution and the company deciding to divest all businesses except its core power and automation technologies divisions.

With his election as ABB India chairman, Paliwal now also overlooks one of the most important markets for ABB. India and China are among the few regions in the world that are seen to offer significant growth opportunities for the company. ABB has also big plans for India.