KUALA LUMPUR (April 15): 7-Eleven Malaysia Holdings Bhd (SEM) has settled its lawsuit against the operator of Dego Ride.
Under the amicable settlement recorded at the High Court, Dego Malaysia Sdn Bhd and its founder Nabil Feisal Bamadhaj are to pay SEM's wholly-owned unit 7-Eleven Malaysia Sdn Bhd, and web service provider Qinetics Solutions Sdn Bhd, a sum of RM2.8 million.
"The settlement sum will be satisfied with an initial payment of RM400,000 and the remaining by way of 24 monthly instalments of RM100,000 each," SEM said in a bourse filing today.
The convenience store operator added in the filing that its RM7.51 million cost of investment in the Dego Ride operator was fully impaired in the financial year ended Dec 31, 2020 (FY20).
It also said that the settlement will not have any material effect on its earnings, net assets and gearing for FY21.
7-Eleven and Qinetics filed the suit against Nabil and Dego Malaysia (which was previously known as Myinteractivelab Sdn Bhd in November 2020. It was over a 2019 subscription agreement between 7-Eleven, Nabil and Dego and a 2019 share sale agreement made between Qinetics and Nabil.
The suit arose from 7-Eleven’s claim for recession of the subscription agreement due to various alleged misrepresentations made by Nabil and Dego to get 7-Eleven to invest in the online motorcycle taxi services.
7-Eleven had announced in December 2019 that it was injecting RM7.51 million in Dego Malaysia by subscribing to 490,030 new shares at RM15.33 a share, giving the group a 46.45% stake in the enlarged issued share capital of Dego. At that point, Nabil controlled 95.23% of Dego Malaysia and Qinetics Solutions controlled 4.77%.
SEM said its directors are of the opinion that the settlement is in the best interest of the group as it enables the group to focus on growing its core businesses going forward.
SEM shares closed five sen or 3.13% higher at RM1.65, valuing the group at RM2.04 billion. The counter saw 269,900 shares traded.