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OTHERS NESTCON BERHAD ("NESTCON" OR "THE COMPANY") - LETTER OF AWARD TO NESTCON BUILDERS SDN. BHD., A WHOLLY-OWNED SUBSIDIARY OF THE COMPANY

NESTCON BERHAD

Type Announcement
Subject OTHERS
Description
NESTCON BERHAD ("NESTCON" OR "THE COMPANY") - LETTER OF AWARD TO NESTCON BUILDERS SDN. BHD., A WHOLLY-OWNED SUBSIDIARY OF THE COMPANY
1. INTRODUCTION

The Board of Directors of Nestcon (“the Board”) wishes to announce that its wholly-owned subsidiary, Nestcon Builders Sdn. Bhd. (“Nestcon Builders”), had on 13 June 2022 accepted the letter of award dated 13 June 2022 (“LOA”) awarded by Nescaya Etika Sdn. Bhd. (“NESB”) to Nestcon Builders as a principal contractor for undertaking the construction and completion of the main building and infrastructure works for the Phase 1 development project undertaken by NESB in respect of the construction of a 38-storey building comprising one block of 678 units residence apartment, 1 floor main lobby, shop, car park and mechanical space on the ground floor, 5 floors car park from levels 1 to 5, 1 floor facilities and residence (19 units) at Level 6, 30 floors residence (659 units) from Levels 7 to 36, 1 floor mechanical space at Level 37 and 1 floor car park and mechanical space on the underground floor to be erected on part of Lot 481675 (formerly PT 9721), Jalan 1/112E, Mukim Kuala Lumpur,  Wilayah Persekutuan Kuala Lumpur for Picoland Sdn. Bhd. (“Project”).

2. INFORMATION OF NESTCON BUILDERS

Nestcon Builders was incorporated in Malaysia as a private company limited by shares and it is a wholly-owned subsidiary of the Company.

The nature of business of Nestcon Builders is principally involved in construction works.

3. INFORMATION ON NESB

NESB was incorporated in Malaysia as a private company limited by shares and having its business address at Lot 6, 2-6, Tiara Mutiara, Jalan Puchong, 58200 Puchong, Kuala Lumpur.

NESB is principally involved in Project Management.

4. DETAILS OF LOA

(a) The contract sum for the Project is a lump sum of RM118,053,498.56 (Ringgit Malaysia: One Hundred Eighteen Million Fifty Three Thousand Four Hundred Ninety Eight and Cents Fifty Six Only), and payment shall be made to Nestcon Builders progressively based on the actual work done as valued and certified by the architect.

(b) The overall completion period for the Project is within twenty eight (28) months and fifteen (15) days from the date of site possession and the date of site possession shall be 1 July 2022. The Project is expected to be completed including the mobilisation period, all festivals and public holidays for handover on or before 15 November 2024.

(c) Nestcon Builders is required to submit an approved Performance Bond in the form of a Corporate Guarantee amounting to RM5,902,675.00 (Ringgit Malaysia: Five Million Nine Hundred Two Thousand Six Hundred and Seventy Five Only) being 5% of the contract sum for the duration up to the end of defects liability period.

(d) The defects liability period of the Project shall be twenty four (24) months from the date of the Certificate of Completion and Compliance of the Project

(e) NESB may terminate the LOA by giving seven (7) days written notice to Nestcon Builders if they default in any of the following:

(i) Without reasonable cause Nestcon Builders suspends the whole or any part of the works under the LOA;

(ii) Nestcon Builders fails to proceed regularly and diligently with the works under the LOA;

(iii) Nestcon Builders fails to execute the works in accordance with the LOA or persistently neglects to carry out their obligations under this LOA;

(iv) Nestcon Builders refuses or persistently neglects to comply with written notice from the architect or NESB to remove or remedy defective works, improper materials or goods;

(v) Nestcon Builders has persistently refused or failed to comply with a written instruction from the architect or the NESB’s representative;

(vi) Nestcon Builders commits an act of bankruptcy, or become insolvent; or is having a winding up order against Nestcon Builders; or is receivership; and

(vii) Nestcon Builders fails to comply with Local Authorities requirements.

5. FINANCIAL EFFECTS

The acceptance of the LOA by Nestcon Builders to undertake the Project is expected to contribute positively to the net assets per share, earnings per share and gearing of the Company for the financial year ending 31 December 2022 and throughout the duration of the Project.

6. RISK FACTORS

The Company does not foresee any exceptional risk other than the normal operational risks associated with the LOA and/or Project. Nevertheless, the Company will take the necessary steps to mitigate the risks as and when they occur.

7. DIRECTORS' AND MAJOR SHAREHOLDERS' INTERESTS

None of the Directors and/or major shareholders of Nestcon or persons connected with them has any interests, direct or indirect, in the LOA and/or Project.

8. STATEMENT BY THE BOARD OF DIRECTORS

The Board is of the opinion that the LOA and the Project are within the ordinary course of business of Nestcon and the acceptance of the LOA is in the best interest of the Company.


This announcement is dated 13 June 2022.





Announcement Info

Company Name NESTCON BERHAD
Stock Name NESTCON
Date Announced 13 Jun 2022
Category General Announcement for PLC
Reference Number GA1-13062022-00033




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