Monday 25 Sep 2023
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KUALA LUMPUR (July 18): Scomi Group Bhd and RC Asia Engineering Sdn Bhd (RCA), a privately-held railway track specialist, have mutually agreed to discontinue their joint venture (JV) after the agreement lapsed on Friday (July 15). The ailing oil and gas service provider blamed delays in commencement of the tenders of potential projects for the JV being scrapped.

In a Bursa Malaysia filing on Monday (July 18), Scomi, a Practice Note 17 (PN17) company, said there has been no material progress on initiatives originally planned to be pursued by both the two companies.

"Both Scomi and RCA remain in discussion on pursuing other forms of collaboration that leverages on the strength of both parties," it added.

The two companies had on July 15 last year entered into a JV agreement to collectively bid for tenders for construction of railway stations, tracks or other related railway infrastructures in the rail industry.

Under the collaboration, Scomi was to own a 51% stake in the JV company and RCA the remaining 49% equity interest.

Scomi had said then that the JV is consistent with its objective of seeking various strategic alliances and JVs for synergistic benefits in order to generate sustainable operational profits and create value for its stakeholders.

Trading of Scomi's shares was suspended on April 20, following Bursa Securities' rejection on April 11 of its request for a further extension of time to submit its regularisation plan.

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