JIC failed to deliver vacant possession, says Star Media

PETALING JAYA: Star Media Group Bhd claims that Jaks Resources Bhd’s sub-subsidiary Jaks Island Circle Sdn Bhd (JIC) failed to deliver vacant possession of Tower A by the stipulated deadline enabling it to demand the RM50 million bank guarantees pledged as security.
“The deadline for the delivery of vacant possession of Tower A had expired on Feb 15, 2018 following the latest extension agreed between Star and Jaks,” Star Media Group said in a stock exchange filing today.
JIC had instructed its solicitors to file with the High Court an injunction to stop Star Media Group from claiming the bank guarantee of RM50 million provided for under a joint development project in Section 13, Petaling Jaya.
In August 2011, JIC, which is 51% owned by Jaks Sdn Bhd a wholly-owned subsidiary of JRB, acquired land in Section 13, Petaling Jaya from Star Media for RM135 million.
As security for the performance of JIC’s obligations under the sale and purchase agreement, JIC provided inter-alia, an irrevocable and on demand bank guarantee in favour of Star Media for the sum of RM50 million guaranteeing the completion and delivery of vacant possession by the purchaser of Tower A within three years from the vacant possession date or three years from the date of approval of the agreed plans for Tower A, whichever is later.
JIC is of the view that the call on the bank guarantee is baseless and JIC has valid grounds for the High Court to grant the injunction as Star has in the course of JIC’s execution of Tower A prevented the completion and thus JIC should have been given extension of time to complete Tower A.
Star Media Group closed down 0.73% today to RM1.36 with 84,000 shares done while JRB closed down 3.26% to RM1.78 with 202,000 shares done.