On Wednesday, TRX City, which is owned by the ministry of finance, said the agreement signed in 2015 with IWH CREC had lapsed. It then gave reasons for this.
IWH CREC disputed the reasons given by TRX City, saying it was reviewing the content of the termination notice and press release by TRX City with its advisers and legal counsel.
IWH CREC Sdn Bhd, is a 60:40 joint-venture between Iskandar Waterfront Holdings Sdn Bhd (IWH) and China Railway Engineering Corp (M) Sdn Bhd (CREC).
The Johor government owns 40% of IWH through Kumpulan Prasarana Rakyat Johor Sdn Bhd.
With the lapsing of the agreement, IWH and CREC are no longer the master developers of the RM200 billion Bandar Malaysia project.
IWH CREC said in a statement last night: “IWH CREC is concerned with the content of the termination notice and the subsequent press release issued by TRX City, which, given the factual matrix, does not fully and accurately reflect the circumstances and conduct of the parties in this matter.
“IWH CREC takes this matter very seriously and is at present reviewing the content of the termination notice and press release with its advisers and legal counsel.”
The statement added that a further announcement on this matter would be made in due course.
Meanwhile, Bursa Saham announced this morning that trade in the shares of Iskandar Waterfront City Bhd (IWCity) had been suspended from 9am today till 5pm tomorrow at the request of IWH, the major shareholder of IWC.
It is believed that the voluntary suspension has something to do with the Bandar Malaysia deal falling through.
The announcement said the suspension followed receipt of a letter from Iskandar Waterfront Holdings Sdn Bhd of its intention to undertake a restructuring exercise involving the company.
On Wednesday, TRX City announced that the share sale agreement (SSA) entered into on Dec 31, 2015, with IWH and CREC regarding the sale of 60% of the issued and paid-up capital of Bandar Malaysia Sdn Bhd, had lapsed.
The TRX statement said: “This is because, despite repeated extensions being granted, IWH CREC failed to meet the payment obligations outlined in the conditions precedent under the SSA. As a result, the share sale agreement between the parties stands null and void with immediate effect.”
On July 21, 2016, IWH and CREC had assigned their benefits and responsibilities to IWH CREC Sdn Bhd.
“Looking ahead, given a significant appreciation in the value of the Bandar Malaysia land, TRX City’s sole shareholder, the ministry of finance, will now be retaining 100% ownership of the site to ensure that the Malaysian people benefit from its development in its entirety,” the TRX City statement added.
The Bandar Malaysia deal was previously touted as part of 1Malaysia Development Bhd’s rationalisation plan to pare down its debt.
The 486-acre prime land in Sungai Besi has since been transferred and placed under the finance ministry.
The statement went on to say that TRX City would welcome any company interested in becoming the master developer of Bandar Malaysia, but with full ownership being preserved by the ministry of finance.
“The selection process will involve very strict criteria, including track record, speed of delivery and financial capability for such large scale development. This is to enhance all aspects of Bandar Malaysia, including its role as a business, transport, residential and tourism hub.
“The steps taken today will ensure that there is no detrimental impact on the long-term development of Bandar Malaysia and that, upon its completion, the site will serve the national interest to an even greater extent than before.”
The government expects Bandar Malaysia – the biggest development site in a strategic position – Malaysia to be a catalyst for economic growth and national development.