Friday 29 Mar 2024
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KUALA LUMPUR (Oct 25): Perak Corp Bhd and Only World Group Holdings Bhd (OWG) have scrapped plans to co-manage and co-operate in the floundering Movie Animation Park Studios (MAPS) in Ipoh, Perak.

The mutual termination of the Heads of Agreement (HOA) was announced by both companies today and comes on the heels of the park’s staggering accumulated losses of RM474 million.

Both companies announced in bourse filings that they had mutually agreed to end the term of the HOA on Oct 23, 2018 as the parties have not executed the definitive master services agreement.

Given the parlous state of MAPS, the HOA termination does not come as a surprise.

Following Pakatan Harapan’s unexpected triumph in the 14th general election in May at the Federal level as well as in Perak, the new administration revealed the extent of losses at MAPS, whose development was driven by the previous Barisan Nasional State government even though it was cautioned against it. MAPS is in danger of becoming a very costly white elephant for the State.

In August, Aulong Assemblyman Nga Kor Ming revealed that the State government was not initially involved in the theme park while Perak State Development Corporation was only to provide land for private sector participation in the project.

However, for reasons unknown, State-owned Perak Corp eventually emerged as the largest shareholder in the project having invested some RM248 million, revealed Nga who has urged a forensics audit of MAPS.

Soft opened to the public in June last year, MAPS reportedly boasts over 40 “unique attractions.”

Even so, it appears not to have taken off.

Indeed there were early signs of problems ahead as in January 2013, Animation Theme Park Sdn Bhd (ATP) — a unit of Perak Corp — apparently discontinued a licence agreement with DreamWorks Animation LLC for the establishment and operation of DreamWorks’ attractions within MAPS after both parties failed to reach an agreement to open the latter’s attractions to the public by a certain date.

Based on ATP's audited financial statements for the financial year ended Dec 31, 2017, Perak Corp said the related intellectual properties rights acquired under the licence agreement, which are classified as intangible assets, have a carrying value of RM17.461 million.

The amount, together with the related inventories and estimated DreamWorks' attractions development in progress cost of RM15.735 million, will be written off in the current financial year.

Thinly-traded, Perak Corp was last traded at about 55 sen on Oct 11. Its market capitalisation is some RM55 million.

OWG closed half a sen lower at 67.5 sen today, for a market value of RM180.29 million.

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