Friday 26 Apr 2024
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This article first appeared in The Edge Financial Daily on October 26, 2018

KUALA LUMPUR: FGV Trading Sdn Bhd, a wholly-owned unit of FGV Holdings Bhd, has commenced arbitration proceedings against Twin Wealth Macao Commercial Offshore Ltd for outstanding payments of US$13.25 million (RM55.16 million) under various palm olein contracts.

The proceedings commenced on Sept 18 under the auspices of the Palm Oil Refiners Association of Malaysia (Poram), FGV, which is in the midst of an internal probe, said in a filing to Bursa Malaysia yesterday.

FGV Trading is alleging that Twin Wealth had only made part-payments to it for its bulk purchase of the refined, bleached, and deodorised palm olein last year.

It said in the months of November and December last year, FGV Trading and Twin Wealth had signed various contracts for the sale of 21,765 tonnes of the palm olein for a total of US$14.62 million (RM60.86 million).

Pursuant to the “free on board” obligations under the sale contracts, FGV Trading had then shipped the cargo in the same months, on board the vessels MT Yue You 901 and MT Global Uranus, it said.

However, to-date, Twin Wealth had only paid for some 2,000 tonnes the sum of about US$1.37 million (RM5.68 million), FGV said.

As the sum represents less than a tenth of the total price, FGV said the balance of US$13.25 million (RM55.16 million) remains due and outstanding in favour of FGV Trading.

The statement of claim against Twin Wealth was filed with Poram on Oct 25, 2018.

FGV said the arbitration proceedings are not expected to have any operational impact on the group and unit, but may have a financial impact depending on whether the debt recovery is successful.

FGV yesterday closed one sen or 0.71% lower to RM1.39 for a market capitalisation of RM5.07 billion.

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