Malaysia Airports reaches settlement with two KLIA2 consultants

An Air Asia aicraft is seen at KLIA2 AZHAR MAHFOF/The Star (BIZ ARCHIVE)

KUALA LUMPUR: Malaysia Airports Holdings Bhd (MAHB) has reached a settlement in the dispute with two of the consulting firms involved in the KLIA2 development project.

The airport operator told Bursa Malaysia that the settlement was reached via negotiation with KLIA Consultancy Services Sdn Bhd (KLIACS) and Straits Consulting Engineers Sdn Bhd (SCE), as the parties had mutually agreed to withhold the arbitration proceeding.

MAHB did not disclose the amount of settlement.

Earlier, MAHB had sought claims against KLIACS of up to RM148.93mil plus interest, costs and any other relief that the arbitrator might deem fit and just.

KLIACS was appointed to provide consultancy services for the proposed development of the new Low Cost Carrier Terminal (LCCT) -- this was later renamed KLIA2 -- and the third runway. 

Meanwhile, the claim against SCE amounted to RM84.31mil, as well as interest, costs and any other relief that the arbitrator decided to give.

These latest settlements followed MAHB's settlement in March with another consultant on the same project, namely HSS Integrated Sdn Bhd (HSSI).

HSSI agreed to pay MAHB RM1.5mil without admission of liability. This sum was much less than the RM64.62mil MAHB had initially sought in relation to the alleged losses and damages it had suffered as at May 2016,

MAHB’s various announcements to Bursa Malaysia did not give details of the exact purported “breaches of obligations” by these three consulting firms. However, the airport operator had previously come under fire over the long delay in the opening of the RM4bil KLIA2.

In a separate announcement, MAHB said Express Rail Link Sdn Bhd (ERL) had discontinued the third party notice against it and its unit Malaysia Airports (Sepang) Sdn Bhd without liberty to file afresh accordingly.

To recap, on Sept 21 last year MAHB and Malaysia Airports (Sepang), which operates KL International Airport and KLIA2, received the notice from ERL to wholly indemnify it against a claim by Segi Astana Sdn Bhd for the sum of RM5.41mil and further and continuing damages from Sept 9, 2016, until “the date of vacant possession of premises” or until such date as deemed appropriate by the court.

Segi Astana, developer and operator of the integrated mall at KLIA2 (gateway@klia2), is a joint venture between WCT Holdings Bhd (70%) and MAHB (30%).
Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 1
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights

Next In Business News

Singapore charges two people for corrupt marine fuel trading practices
FBM KLCI slips below 1,600 as bank weigh
Rehda: Govt intervention crucial if material cost problem serious
CIMB to provide property financing to Juwai IQI customers in Malaysia
Etiqa General Insurance wins top motor insurance award
Strong commodities performance boosts ringgit
Trading ideas: Tenaga, Pestech, Bintai Kinden, Daya and SKB
IGB sells 50% stake in London real estate for RM600mil
FBM KLCI pauses on mild profit-taking
Tenaga on pace to realising RE goals

Others Also Read