Zecon's shares fall 7.5% on news of hospital contract termination

PETALING JAYA: Zecon Bhd's share price fell 7.5% to 37 sen on early trade upon the termination of its RM 495 million contract to construct Petra Jaya Hospital in Kuching, Sarawak by the Public Works Department (JKR).
At 10.47 am, the stock was trading at 38 sen with 823,900 shares done.
In a filing with Bursa Malaysia yesterday, Zecon said it received the notice of termination dated Aug 2, 2018 from JKR for the contract to build a 300-bed hospital located in Petra Jaya.
"The board had sought legal advice on the termination as the company is of the opinion that the purported termination is wrongful and that the company will be seeking legal redress including initiating an action to challenge the termination through the courts," it said.
The contract is one of the government hospital and clinic projects nationwide that the Health Ministry had slotted for termination, due to failure to complete within the stipulated time frame.