Thursday 28 Mar 2024
By
main news image

KUALA LUMPUR (Jan 26): Mudajaya Corp Bhd (MCB), a wholly owned unit of Mudajaya Group Bhd, is seeking an adjudication in relation to the principal payment of RM175.33 million for the construction of Phase Four of the 1,000MW power plant at Manjung, Perak (Manjung Four).

In a bourse filing today, Mudajaya said MCB has served a notice of adjudication under Section 8 of the Construction Industry Payment and Adjudication Act 2012 (CIPAA) against CMC Machipex Sdn Bhd to recover the said amount.

MCB is also seeking for late payment interest and costs, the amount of which will be determined at a later stage.

Mudajaya said CMC engaged MCB as subcontractor through a subcontract agreement dated Aug 22, 2011, to execute and complete "certain design, construction and completion of civil and structural works associated with the balance of plant and construction" for Manjung Four. The subcontract price was RM720 million.

Subsequently, MCB submitted its payment claims for works done to CMC.

However, due to non-payment by CMC and disputes arising from MCB's payment claims, MCB proceeded with the adjudication claim for payment under Section 5 of the CIPAA.

"CMC admitted some of the claims, but disputed the rest of MCB's claims and, in turn, made a counterclaim in the form of a 'set off' in the amount of RM61.76 million. CMC does not seek for a counterclaim in excess of MCB's claims," said Mudajaya.

After the commencement of the adjudication proceedings, Rajendra Navaratnam was appointed by the Kuala Lumpur Regional Centre for Arbitration as the adjudicator in the case.

The adjudicator has fixed a further preliminary meeting on Feb 5, 2016, whereby he is expected to give further directions to the parties with regards to the proceedings.

While there is no operational impact from the payment claim, Mudajaya said its management is of the opinion that should MCB succeed in the proceedings, it will have a positive impact on the financial position of the group in the current financial year ending Dec 31, 2016.

Mudajaya shares closed half sen or 4.13% lower at RM1.16 today, giving it a market capitalisation of RM624.54 million.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

 

      Print
      Text Size
      Share