KUALA LUMPUR (Aug 22): Construction firm Kerjaya Prospek Group Bhd's (KL:KERJAYA) unit is suing Apple 99 Development Sdn Bhd, a wholly owned subsidiary of Yong Tai Bhd (KL:YONGTAI), over an alleged failure to pay an outstanding contract sum of RM105.14 million.
In a filing with Bursa Malaysia on Thursday, Kerjaya Prospek said its wholly-owned subsidiary Kerjaya Prospek (M) Sdn Bhd (KP) has filed a writ of summons and statement of claim against Apple 99 for failing to pay the outstanding residual contract sum of RM105.14 million.
It is also seeking a declaration that Apple 99 is in breach of a settlement agreement (SA) dated Feb 25, 2020, as well as an order for specific performance of the SA and the hotel sales and purchase agreement (SPA).
KP contends that Apple 99’s failure to pay the contract sum, coupled with the fact that there was no sale of the hotel to a third party by the expiry period, KP is now entitled under the SA to proceed with the hotel SPA.
"Alternatively, and only in the event that this Honourable Court deems specific performance to be an unsuitable remedy [which is denied], an order that Apple 99 be required to pay to KP a sum of RM105.14 million or such other sum as may be determined by this Honourable Court being the outstanding residual contract sum," Kerjaya Prospek said.
Recall that in 2016, Kerjaya Prospek had bagged a contract worth RM213.75 million from Yong Tai for the construction of main building works of a proposed mixed development project known as "The Apple". The project is a joint venture between Yong Tai and PTS Properties Sdn Bhd in Melaka.
It comprises a 16-storey hotel building with 284 rooms, known as Courtyard by Marriott, a 32-storey service suite building with 361 units of serviced apartments, and an eight-storey podium of car park.
Kerjaya Prospek said pending the outcome of the litigation process, the lawsuit is not expected to have any immediate material financial impact on the group for the financial year ending Dec 31, 2024. It is also not expected to have any immediate operational impacts on the group.
Kerjaya Prospek shares closed down a sen or 0.52% at RM1.93 on Thursday, giving it a market capitalisation of RM2.45 billion. The stock has risen 26.97% so far this year.