KUALA LUMPUR (Dec 11): FGV Holdings Bhd said today an independent expert has been appointed to ascertain the accuracy of the calculations of the outstanding US$11.7 million payment owed by Dubai-based Safitex General Trading LLC to FGV's subsidiary Delima Oil Products Sdn Bhd.
In a filing with Bursa Malaysia today, FGV said the appointment was made by the Dubai Court of First Instance.
"The court has directed Delima and Safitex to meet with the expert on Dec 23. Subsequently, the expert will prepare a report setting out its findings and the court will fix a hearing date to pronounce its decision on this matter," it added.
On March 30, FGV had announced that its unit Delima Oil had taken legal action against Safitex in the Dubai court seeking US$11.7 million in payment, together with interest, as well as charges, expenses and costs incurred from the suit.
According to FGV, Safitex is a commercial company operating in the United Arab Emirates and had entered into contracts with Delima Oil for the purchase of refined crude palm oil and margarine. Delima Oil had provided Safitex with all products required under its contractual obligations, but the latter had failed to pay Delima Oil US$11.7 million to date.
"This material litigation against Safitex may have a material financial impact on Delima Oil as a favourable outcome may reverse the earlier impairment provisions made by Delima Oil for the US$11.7 million amount during the financial years ended Dec 31, 2016 and 2017, while an unfavourable outcome will result in further losses to Delima Oil," said FGV.
FGV shares closed down 5 sen or 6.49% at 72 sen today, with 14.56 million shares done, bringing it a market capitalisation of RM2.63 billion.