KUALA LUMPUR: GUH Holdings Bhd is suing a joint venture (JV) of JAKS Resources Bhd for failing to abide by an arbitration decision that ordered it to pay GUH RM11.67 million in outstanding sum owed for work done previously, together with interests and arbitration costs.
In a Bursa Malaysia filing, GUH said it had, via its unit Teknoserv Engineering Sdn Bhd, filed the originating summons at the High Court here against the JV unit — JAKS-KACC JV — and the JV partners JAKS Sdn Bhd (JSB) and KACC Construction Sdn Bhd, to enforce the adjudication decision. JSB is a wholly owned unit of JAKS Resources.
GUH said Teknoserv initiated the adjudication proceedings against the JV unit in August last year, and that the decision in favour of the group — which ordered JAKS-KACC JV to pay Teknoserv within 14 days of the award date — was delivered on Dec 23, 2022.
“As at the date of this announcement, JAKS-KACC JV has failed to make any payment to Teknoserv pursuant to the adjudication decision, despite the fact that the deadline to do so has lapsed. Consequently, Teknoserv has filed an originating summons in the Kuala Lumpur High Court to enforce the adjudication decision…” GUH's Tuesday (Jan 11) filing read.
“Sealed copies of the originating summons will be served on JAKS Sdn Bhd and KACC Construction Sdn Bhd in due course. The company will make the appropriate announcements as and when there are material developments in relation thereof,” GUH added.
According to GUH's past filings, Teknoserv was appointed by the JV unit as the sub-contractor in July 2014 to build a new network pumping station in Batu, Jinjang-Kepong, Kuala Lumpur, at an agreed contract sum of RM63.5 million.
It said the project's completion date was extended from December 2017 till August 2021, but Teknoserv terminated the agreement a month earlier in July 2021 after issuing a notice of contract breach to JAKS-KACC JV. The JV unit, in response, claimed Teknoserv had failed to perform its works under the contract and wrongfully repudiated its employment.
Teknoserv subsequently initiated the arbitration proceedings and claimed for RM22.6 million or such other sum as assessed by the adjudicator, together with interests and costs.
GUH's share price closed unchanged at 41 sen on Wednesday, valuing the group at RM114.91 million. JAKS Resources settled half a sen higher at 24 sen, giving it a market capitalisation of RM501.68 million.
Source : The Edge Markets