GEORGE TOWN: The Penang Development Corporation’s (PDC) board of directors (BOD) have decided to terminate its joint venture (JV) agreement with UMECH Land Sdn Bhd (UMECH) following the change in the company's equity structure.
In a statement, PDC said the change in the equity structure of UMECH, to the extent that there was a change in the party controlling and leading the implementation of projects without notifying and obtaining PDC's official approval is an issue that is taken seriously and cannot be accepted by its BOD.
"Therefore, the BOD has decided to terminate the JV agreement with UMECH by giving a three-month notice based on clause 19 of the PDC - UMECH’s JV agreement," it said in a statement today.
PDC said that following the termination of the contract, the company will be advertising a Request For Proposal (RFP) for a proposed collaboration with PDC to develop the Batu Kawan Industrial Park 2 (BKIP2) via mass media channels.
Previously, the Penang Chinese Chamber of Commerce had questioned the state government regarding the selection of UMECH as a partner to develop 226.22 hectares of land in Byram, near the Pulau Burung landfill site in the BKIP2 area.
Among the questions is why the land was sold through direct negotiations without an open tender and why it was assessed at a low rate.
On this note, PDC said that its BOD had examined the selection of UMECH and found that the selection process, including the determination of cash contributions, and the payment schedule to PDC was transparent and in line with PDC policy. - Bernama