PETALING JAYA: Star Media Group Bhd has received a purported notice of arbitration from a subsidiary of JAKS Resources Bhd to resolve the dispute between the two parties in relation to a property development project in Section 13, Petaling Jaya.
In a filing with Bursa Malaysia, Star Media Group said the group had responded to the solicitors of JAKS’ subsidiary, JAKS Island Circle Sdn Bhd (JIC), that it disagreed with the disputes or differences that have arisen between the company and JIC in connection with the sale and purchase agreement (SPA).
“JIC had never raised such alleged disputes or differences during the performance of its obligations under the SPA. Such alleged disputes or differences do not in any way affect the company’s call on the bank guarantees which terms clearly provide that the performance of the bank guarantees shall not be prevented by any contestation, protestation or arbitration,” it said.
Star Media Group contended that the letter it received from JIC could not amount to a notice of arbitration when it was premature and did not even state or particularise JIC’s alleged dispute intended to be referred for arbitration.
In 2011, Star Media Group had entered into an SPA with JIC for the disposal of a piece of land in Section 13 for RM135mil.
In lieu of cash, JIC was to deliver a 15-storey office block known as Tower A. The delivery of the tower, however, has been delayed by 28 months.
Last month, Star Media Group called on bank guarantees amounting to RM50mil that was given by JIC as security to ensure the completion and delivery of Tower A.
JIC has obtained an interim stay restraining the issuing financial institutions from paying out the proceeds of the bank guarantee until the next hearing on March 20.