KUALA LUMPUR (Feb 14): Sarawak Consolidated Industries Bhd (SCIB) has terminated a proposed engineering, procurement, construction and commissioning (EPCC) project worth RM55.59 million, involving earthworks for the Prabumulih-Muara Enim tolled road in Sumatera, Indonesia.
The civil engineering specialist’s wholly owned unit SCIB International (Labuan) Ltd (SCIBILL) issued a notice of termination to PT Cipta Multi Sarana (PTCMS) on Monday (Feb 13), amid a lack of progress in the project arising from Covid-19 pandemic uncertainties and initiatives to review and update SCIB’s order books.
SCIBILL secured the EPCC project from PTCMS in August 2020.
“SCIBILL and PTCMS have mutually agreed to terminate the contract and unconditionally release and indefinitely discharge both parties from all claims, liens and obligations of every nature arising out of or in connection with the performance of the works and all amendments thereto, provided that the parties’ obligations under a settlement agreement are fulfilled,” SCIB said in a statement to the bourse on Tuesday (Feb 14).
SCIB managing director Rosland Othman said there are no penalties or liquidated ascertained damages to SCIBILL over the termination of the project.
This is not the first contract termination by SCIB this year. In late January, the group withdrew from EPCC contracts involving a specialist hospital project in Johor Bahru.
The group is also proposing a 10% private placement to raise up to RM10.98 million mainly for repayment of bank borrowings and to fund its working capital requirements.
For the first quarter ended Sept 30, 2022 (1QFY2023), SCIB’s net loss was narrowed to RM871,000 from RM2.7 million in the previous year, as revenue increased to RM30.33 million from RM26.49 million.
Shares of SCIB finished half a sen or 3.33% lower to 14.5 sen on Tuesday, valuing the group at RM84.4 million.
Source: TheEdge - 15 Feb 2023
