KUALA LUMPUR (Dec 31): MMC Corp Bhd, controlled by tycoon Tan Sri Syed Mokhtar Albukhary, said its associate company Almiyah Attilemcania SPA (AAS), has been slapped with a penalty of DZD3.93 billion (US$44.6 million) by the lower court of Ghazouet in Algeria, over a breach of foreign exchange regulations.

MMC will lodge an appeal with the Algerian Court of Appeal to set aside the decision of the lower court, its filing with Bursa Malaysa this evening read.

“AAS has been advised by its solicitors that the penalty would not be enforced until the exhaustion of all rights to appeal by AAS in respect of the legal proceedings. AAS had filed an appeal against the decision of the court to the Algerian Court of Appeal,” said MMC.

MMC said the penalty was not expected to have any material impact on its earnings for the financial years ending Dec 31, 2014 (FY14) and FY15.

To recap, MMC had on Nov 12 announced that a legal proceeding had been initiated against AAS over a breach of foreign exchange regulations concerning a sum of US$26.99 million (RM94.33 million).

MMC has an effective interest of 18.2% in AAS, held through its subsidiary Malakoff Corp Bhd.

AAS is a joint-stock company incorporated in Algeria to undertake a sea water desalination plant in the district of Tlemcen, Algeria.

Shares in MMC closed 9 sen or 2.63% lower at RM2.39 today, giving it a market capitalisation of RM7.4 billion.