KUALA LUMPUR (June 22): Ann Joo Resources Bhd said Amsteel Mills Sdn Bhd has taken legal action against its wholly-owned subsidiary Ann Joo Steel Bhd for wrongfully terminating a supply contract and addendum.

In a filing with Bursa Malaysia today, Ann Joo Resources said Ann Joo Steel had yesterday received a writ and statement of claim from Amsteel, seeking among others, RM14.96 million as incurred loss of profits as a result of the termination, which would otherwise have been made from the sales of re-bar and wire rod using the billet that were ordered.

Amsteel is also seeking damages of RM885,200 being the difference between the price of the re-bar billet in the contract and addendum, and the market price of re-bar billet at the latest date of delivery.

It also sought a declaration that Amsteel is entitled to loss of profits for the failure of Ann Joo Steel to proceed with the supply contract and addendum, as well as costs and/or other relief as the High Court deems fit and proper.

"The Court has fixed a case management before the registrar on July 18 and Ann Joo Steel’s solicitors are required to enter appearance by July 4," the filing said.

"The board wishes to highlight that Ann Joo Steel has valid and strong grounds not to continue with the supply contract and has instructed its solicitors to refute the claim on the alleged wrongful termination and also the damages claimed by Amsteel," the filing added.

Ann Joo is also of the view that the statement of claim has no material impact on the financial position of the group and has no impact on the operations of Ann Joo Steel.

Ann Joo shares closed up 12 sen or 4% at RM3.12 today, for a market capitalisation of RM1.6 billion.