GDB’s legal actions over 8 Conlay job termination disputes face three-month pause

• This was after the court granted the pair (DCSB and KSK Land) and their parent KSK Group Bhd, another restraining order against their creditors.

KUALA LUMPUR (Feb 13): GDB Holdings Bhd’s legal actions against Damai City Sdn Bhd (DCSB) and KSK Land Sdn Bhd over the 8 Conlay project disputes have been put back on hold for three months.

This was after the court granted the pair (DCSB and KSK Land) and their parent KSK Group Bhd, another restraining order against their creditors.

The restraining order, which restrains all actions or proceedings against the three companies (collectively KSK Group) for three months, was granted by the Shah Alam High Court on Feb 8, to make way for them to hold a creditors’ meeting to consider a scheme of arrangement to settle their outstanding debts.

The court order was granted in response to an ex-parte application made by Stafford Financial Capital Ltd, a creditor of DCSB, according to GDB’s bourse filing on Tuesday.

“In view of the court order, Grand Dynamic Builders Sdn Bhd (GDBSB — a wholly owned unit of GDB) shall seek advice from its solicitors concerning the court, arbitration and adjudication proceedings in relation to KSK Land and DCSB respectively,” the construction outfit said.

“Further announcements will be made to Bursa Malaysia Securities Bhd, as and when there are material developments in relation thereof,” it added.

GDB’s legal dispute with KSK Group relates to the termination of GDBSB’s RM1.25 billion contract as main contractor for the construction of the 8 Conlay mixed development back in April 2023.

In response to the termination, GDBSB has an ongoing RM102.08 million suit against KSK Land for purportedly breaching its obligations under a corporate guarantee made on Aug 5, 2022.

Meanwhile, GDBSB also initiated arbitration proceedings against DCSB, in which the adjudicator ordered DCSB to pay GDBSB RM97.8 million.

GDBSB has another suit against DCSB at the Kuala Lumpur High Court, to enforce the adjudication judgement as if it is a court judgement.

GDBSB also filed a winding-up petition against KSK Land last month, seeking to liquidate KSK Land.

Prior to its termination from the job, GDBSB had suspended works on the 8 Conlay project and sued KSK Land on Aug 16, 2022, for RM120.7 million in relation to the corporate guarantee breach.

After DCSB made a partial payment toward the outstanding sum, GDBSB re-commenced certain works on the project in January 2023 and later dropped its suit with liberty, to file afresh in March.

However, after DCSB failed to pay an instalment sum in April, parties entered talks to resolve the dispute amicably.

When parties were unable to reach a settlement consensus, DCSB terminated GDBSB from the job, while GDBSB responded with its RM102.08 million suit against KSK Land.

Shares in GDB ended half a sen or 2.38% higher at 21.5 sen on Tuesday, giving the company a market capitalisation of RM201.56 million.

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