The Board of Directors of MClean wishes to announce that the
Company’s subsidiaries, DWZ Industries Sdn. Bhd. (“DWZ”) and DWZ
Industries (Johor) Sdn. Bhd. had been served with a Letter of Demand by
Petroliam Nasional Berhad (“Petroliam”) and Petronas Gas Berhad (“PGB”)
(“collectively referred to as “Petronas”) through its solicitors for:
1. unlawful entry or caused to enter the lands held under
HS(M) 4144 PTD 179156, Mukim Plentong, Johor Bahru, Johor and no.
Hakmilik 1027, Mukim Plentong, Johor Bahru, Johor (collectively referred
to as “Lands”) and constructed and/or installed a piping structure
of approximately 50 metres under the Lands which is connected to DWZ’s
premises at No. 30, Jalan Maju 1, Taman Perindustrian Desa Cemerlang,
81800 Ulu Tiram, Johor (“the Premises”); and
2. discharge of certain noxious and toxic effluents from DWZ’s piping structure and the Premises onto the Lands, which has caused substantial damage to PGB’s pipeline.
Due to the above, Petronas has demanded for a sum of RM46,754,614.07
from the Company and/or its subsidiaries. Failing which, Petronas will
commence legal proceedings against the Company and/or its subsidiaries
to recover all sums due and additionally liable for interest and costs.
DWZ is a major subsidiary of the Company. MClean Group does not
foresee any material impact to its operations as a result of this Letter
of Demand.
That does not sound good.
First of all one should not get in a fight with (by far) the biggest company in Malaysia.
Secondly, RM 47 Million is a rather substantial amount of money for MClean. Its latest cash balance is only RM 13 Million.
Thirdly, one would expect MClean to come with a strong, immediate rebuttal, but instead it rather "casually" mentioned:
The Company has engaged a solicitor to look into the matter and shall
make such further announcement on the development on the above matter
as and when necessary.
MClean was queried by Bursa, and replied, two snippets:
The Letter of Demand [from Petronas] was received on or about 22 February 2016.
MClean did not explain why they waited one full week to inform its
shareholders, to me it looks like material information, getting a letter
of demand from a large corporate, the claim amount being about 3.5
times the cash in the company.
We are confident that the medium to long-term impact will not be adverse to the Group.
Time will tell.
In the previous query MClean confidently wrote:
"We are confident that the medium to long-term impact will not be adverse to the Group."
"We are confident that the medium to long-term impact will not be adverse to the Group."
In a new announcement MClean apparently changed its mind (possibly after some pressure by Bursa?):
".... the Board of Directors of MClean wishes to further inform that if in the event the claim is payable it will have an adverse financial impact to the Group."
The amount claimed by Petronas (RM 47 million) is not exactly peanuts
for a smallish company like MClean, about 3.6 times the cash in hand.
