Hanson boosted by US plan to limit asbestos claims

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The Independent Online

Hanson, the building materials company, received a boost yesterday when US legislators advanced plans to cap the amount of compensation companies have to pay victims of asbestos-related illnesses.

Hanson, the building materials company, received a boost yesterday when US legislators advanced plans to cap the amount of compensation companies have to pay victims of asbestos-related illnesses.

Shares in the the company, which is being sued by thousands of alleged victims of asbestos, rose 6.5p to 394.25p on the back of a plan by the Senate to agree a $140bn (£78bn) fund to cover all claims, which would be financed by companies exposed to claims.

Companies on both sides of the Atlantic are estimated to have already paid out $54bn to the thousands of individuals who have filed class action lawsuits after becoming ill from being exposed to asbestos.

Hanson has one of the largest exposures to asbestos claims among British companies from its acquisitions of Kaiser Cement in 1988 and Beazer in 1991. Both companies had stopped producing asbestos when Hanson bought them.

Hanson said in July it had 132,400 outstanding claimants in legal cases related to asbestos and was maintaining a provision on its balance sheet for claims of $320m.

America's Rand Institute estimated last year that the final compensation figure could run to more than $210bn for the whole industry if payouts continued to be awarded through the lengthy and expensive court process.

Politicians in America have for months been trying to reach an agreement on a fund to put a ceiling on claims and to cut the amount of money being siphoned off by lawyers. Rand estimated that of the $54bn paid out, less than half had gone to the people who were pressing for compensation for their illnesses.

Tom Daschle, the Democratic leader of the Senate, agreed to back a plan by the Republicans to set overall asbestos funding at $140bn. The move was seen as a major breakthrough by business groups because Democrats and Republicans had previously disagreed about the size of the fund.

Last year, Democrats rejected a proposal that the fund should be set at $114bn and had been pushing for the pool to be $145bn or more. This week's move by the Senate is only provisional.

A spokesperson for Hanson said yesterday: "This remains a difficult political process and it is doubtful that any reforms will be passed before the November elections."

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