KUALA LUMPUR (Aug 8): Khee San Bhd (KSB) alleged today that Bank of China (M) Bhd (BOC) had committed breach of conduct as the lender took legal action against the candy manufacturer and its wholly-owned subsidiary Khee San Food Industries Sdn Bhd (KSFI) after a default on loan repayment amounting to RM14.62 million.

In a Bursa Malaysia filing today, KSB said it had on Tuesday (Aug 6) received a writ of summons together with the statement of claim dated Aug 1 from BOC. Law firm Skrine & Co is representing BOC in the legal action against KSB and KSFI, KSB said.

KSB said: "It's the opinion of the company that BOC should not have proceeded with legal proceedings against KSFI and KSB to recover the outstanding amounts."

"The company would like to highlight that the writ of summons (which was filed on Aug 1, 2019) was in fact filed prior to the meeting held with the bankers (on Aug 2, 2019) while BOC kept silent on the filing of the writ throughout the meeting, and in fact misled KSB and KSFI," KSB claimed.

KSB said its lawyer believes the group has good defence against BOC's legal action and that the company was advised to take all measures including lodgement of necessary complaints to banking authorities on BOC's breach of conduct.

"The company will file (a) memorandum of appearance on Aug 13, 2019 and case management has been fixed on Aug 15, 2019 for further directions from the court.

"Nonetheless, KSFI and KSB are engaging (in) active dialogue session with all its bankers and will submit a comprehensive proposal to reschedule the loan facilities in due course," KSB said.

At the time of writing, BOC had not issued a statement in response to KSB's allegations.