KUALA LUMPUR (July 11): Kejuruteraan Asastera Bhd (KAB) will be transferred a piece of leasehold residential land measuring 6,015 sq m in Bukit Raja, Selangor as a form of debt settlement for unpaid subcontract works it completed for a mixed development project in Nilai, Seremban.
The land comes with a price tag of RM3.47 million.
On top of that, KAB will be paid RM1.54 million cash in 12 instalments, an exchange filing showed today.
In 2016, KAB was appointed as a subcontractor by Eng Han Engineering Sdn Bhd to supply, install, test, and commission electrical services for the third phase of the project. It completed the subcontract works, but did not receive the payment of RM5.01 million.
Meanwhile, developer Hari Lumayan Sdn Bhd is indebted to Eng Han payment for the main contract works.
The parties have now entered into tripartite and debt settlement agreements for Hari Lumayan to take up all obligations on the part of Eng Han to pay the debts directly to KAB.
KAB said this is the best possible arrangement for the company to recover part of the outstanding amount it was owed.
KAB expects the land acquisition to be completed by the first quarter of 2020.
Shares in KAB closed unchanged at 21 sen today for a market capitalisation of RM74.1 million.