KUALA LUMPUR (March 15): Pestech International Bhd has aborted plans to jointly explore the setting-up of a power supply infrastructure to the Dongphosy Specific Economic Zone (DSEZ) in Laos with Vientiane-based developer UPL Lao Co Ltd.
In a filing with Bursa Malaysia today, Pestech said it and UPL had mutually agreed to terminate the Memorandum of Understanding (MoU) with immediate effect.
"Notwithstanding the termination, the group continues to explore for business potential in Laos and will continue to look out for other business opportunities in Laos," it added.
On Nov 6, 2012, Pestech announced that it had signed an MoU with UPL Lao Co Ltd, which had won the mandate to jointly develop the DSEZ with the Lao government into a mixed real estate development.
Back then, Pestech and UPL were supposed to work out a proposal for the establishment of the power supply infrastructure to the DSEZ, which covers an area of 53.9ha and is on a 50-year lease with the option for a 40-year extension.
Located 50m across from the Dongphosy Immigration checkpoint and 19km from Vientiane, the DSEZ is a mixed development with education and medical institutions, industrial and bonded warehousing facilities and commercial lots comprising shopping malls, financial centre and integrated resort.
"The termination of the MoU is not expected to have any effect on the issued share capital and substantial shareholders' shareholding of Pestech. It is also not expected to have any material effect on the group's net assets, earnings per share and gearing for the financial year ending June 30, 2018," said Pestech.
Shares in Pestech closed one sen or 0.6% higher at RM1.68 today, giving it a market capitalisation of RM1.28 billion.