KUALA LUMPUR (July 13): Perak Corp Bhd (KL:PRKCORP) said the group's 49%-owned associate has defaulted on RM18.36 million in financing repayments to Malaysia Debt Ventures Bhd (MDV), prompting the lender to recall the facility.
The Practice Note 17 (PN17) group, however, said the default by Suaconcept Pro Sdn Bhd is not expected to materially affect the group's financial position or derail the implementation of its approved regularisation plan.
In a filing with Bursa Malaysia on Monday, Perak Corp said MDV, through its solicitors, issued a notice of termination to Suaconcept on July 6, recalling the project financing facility and demanding repayment of the outstanding RM18.36 million owed as at June 30.
Perak Corp said it had also provided an irrevocable and unconditional corporate guarantee for the facility, proportionate to its 49% indirect equity interest in Suaconcept.
As a result, MDV on July 7 served the group with a notice of termination demanding payment of RM8.997 million, representing 49% of Suaconcept's outstanding indebtedness as at June 30.
Following discussions with MDV, Perak Corp said it submitted a proposed structured repayment arrangement on July 10. In response, MDV has placed the notice against the group "in abeyance for a period of 30 days" to facilitate further discussions to finalise a settlement.
Perak Corp said Suaconcept is not a major associate, and that its investment in the company had already been fully impaired, while the appropriate loss allowance in respect of the financial guarantee contract had been recognised in prior financial years.
"Accordingly, the default does not give rise to any further material impairment or financial impact on the company's consolidated financial statements," it said.
Perak Corp also noted that its wholly-owned subsidiary PCB Equity Sdn Bhd had entered into a share sale agreement in May 2022 to dispose of its entire 49% stake in Suaconcept for RM12.5 million. The purchase consideration has been fully received, with completion pending the fulfilment of the remaining conditions by the purchaser.
Perak Corp said the default is not expected to have any material adverse impact on the group's business operations, financial position or operational continuity, adding that it remains confident of reaching a settlement arrangement with MDV.
"Notwithstanding the default, the implementation of the company's approved PN17 regularisation plan will not be affected and [remains] on track," it added.
For the first quarter ended March 31, 2026, Perak Corp's net profit surged to RM6.86 million from RM132,000 a year earlier, while revenue rose 63.9% to RM61.08 million from RM37.26 million, driven by stronger contributions from its port and logistics and property development segments, as well as impairment reversals following its transition to a going concern basis.
Bursa Malaysia approved Perak Corp's proposed regularisation plan in January, paving the way for the group to proceed with its multi-pronged restructuring to exit PN17 status. The plan comprises a capital reduction, land disposals, a joint development project, settlement entitlements and the issuance of redeemable preference shares to restructure debt.
Shares in Perak Corp were untraded on Monday. The counter last traded at 50 sen with a market capitalisation of RM50 million. Year to date, the stock is down 32.4%.