KUCHING: Sarawak Consolidated Industries Bhd (SCIB) has withdrawn from contracts involving Kencana Healthcare Sdn Bhd’s (KHSB’s) specialist hospital project in Johor Bahru.
The company in a statement on Friday (Jan 27) said it had issued a letter of withdrawal for the proposed engineering, procurement, construction and commissioning (EPCC) contracts.
The proposed contracts awarded on Aug 13, 2021, which cover the lease concession for the purchase, supply, installation, testing, and commissioning of medical equipment, as well as the capital equipment procurement, according to SCIB, had been accepted by KHSB as a withdrawal.
The company noted that commitment fee of RM1.65mil that SCIB had been paid out in two tranches as part of the project’s withdrawal would be reimbursed by KHSB under the terms of a settlement agreement.
“The company is enforcing its rights under the contracts and taking the necessary measures to protect SCIB’s interests in mitigating the risks arising from the long delay or non-movement of project progress due to the uncertainties and inability to secure the necessary operator for the project.
“Additionally, this decision was made due to reviewing and updating our order book records to reflect the current situation,” said SCIB group managing director Rosland Othman.
As such, SCIB added that the withdrawal from the contracts would not have any material effect on the gearing, earnings per share and net assets of the company for the financial year ending June 30, 2023.
