YFG loses one contract but gains another on same day

  • Corporate News
  • Monday, 14 Aug 2017

KUALA LUMPUR: YFG Bhd’s RM245mil subcontracts to build PR1MA houses in Rembau, Negri Sembilan, have been terminated, but this is largely offset by a newly-clinched RM235mil deal to build apartments in Kajang, Selangor.

In separate statements to Bursa Malaysia on Monday, the construction firm as well as electrical and mechanical engineering services provider said Wearegold Sdn Bhd (WRG) had cancelled the subcontracts awarded to it on Feb 16 for building 1,572 single and double-storey linked PR1MA houses in Pedas, while Pierre Suite had awarded it contract works for the construction of apartments in Kajang.

The aborted two-year Pedas project involved the construction of 1,572 single- and double-storey linked houses.

“The contract is terminated as WRG is unable to participate in the company’s proposed regularisation plan due to unforeseen reasons. In view of the foregoing, YFG and WRG hereby mutually agree to terminate the contract with immediate effect,” said the Practice Note 17-affected company, which incurred losses in the last three financial years to Sept 30, 2016, and the first half of this year.

This is the second contract termination announced this year. In January, YFG disclosed  the termination of mechanical and electrical works for a regional sewerage treatment plant in Jinjang Kepong, Selangor, which was linked to its earlier proposed regularisation plan.

Last October, YFG sought to withdraw the proposed plan. which included the RM200.93mil sub-contract from Ocean Electrical Co Sdn Bhd (YFG had wanted to diversify into the water and wastewater customer segments) following the contract’s termination on Sept 29, 2016. 

(The contract’s cancellation was not mentioned in the statement on the withdrawal of the regularisation plan that was posted then on Bursa’s website.)

On the latest contract win, YFG announced that the 36-month Kajang project involved the building, and infrastructure and landscaping works.

“The project is expected to contribute positively to the revenue and earnings of the group for the financial year ending Sept 30, 2018 and beyond,” it said.

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