KUALA LUMPUR (Sept 4): Ageson Bhd said RHB Bank Bhd is suing the group over an RM33 million term loan obtained by its wholly-owned subsidiary Ageson Development Sdn Bhd.

Ageson said it had signed a corporate guarantee and indemnity under which it agreed to pay RHB for the amount owed by Ageson Development.

RHB had used RM662,689.50 from the debt service reserve account maintained by Ageson Development to reduce the indebtedness under the loan, the group said in a filing with Bursa Malaysia.

It said RHB is seeking RM20.8 million as at July 31, with a 3.5% interest per annum above the bank’s base lending rate on daily basis with monthly rests from Aug 1 until the date of full settlement.

“Prior to the service of the writ and statement of claim, the group has presented to the plaintiff (RHB) that it has the financial strength to meet and settle the sum owing to the plaintiff.

“The group has been in constant discussions and negotiations with the plaintiff whereby numerous proposals on the settlement of the sum were [submitted] to the plaintiff but however, the plaintiff has proceeded with the service of the writ and statement of claim,” said Ageson.

In light of this, the group said it will work with its solicitor to defend itself against the claims.

The group also believes that it has the financial capability to settle the sum claimed by RHB and will continue to negotiate with the latter for a solution.

Shares in Ageson closed unchanged at 14.5 sen, giving it a market capitalisation of RM131.78 million. Some 34.7 million shares were traded.