KUALA LUMPUR (Feb 12): The termination of the RM584.84 million contract awarded to Muhibbah Engineering (M) Bhd earlier was due to “commercial and operational issues”.
In a filing with Bursa Malaysia today, Muhibbah said it has gotten a clarification from Bintulu Port Authority that the contract termination was attributable to the authority’s “commercial and operational issues”.
Meanwhile, Muhibbah said its 51%-owned unit Muhibbah Viccana JV and Bintulu Port Authority are in discussion on the compensation related to the termination of the contract.
On Jan 17, Muhibbah announced that the Bintulu Port Authority had cancelled the contract that was rewarded to the company to build a supply base wharf at the second harbour basin of the port in Sarawak. The project, which was awarded to Muhibbah Viccana JV on April 28, 2017, was expected to be completed by the end of 2019.
Muhibbah’s share price closed unchanged at RM2.85 today, giving it a market capitalisation of RM1.37 billion.