CYBERJAYA: Prestariang Bhd does not rule out the possibility of a cash call to address the cash flow concerns raised by its auditors.
“We are looking at all options, if there is a good basis and rationale we will do it but we won’t just put out a cash call. It’s all about investing in the future,“ said group president and CEO Dr Abu Hasan Ismail after its AGM today.
The group clarified that negative cash flow concerns were due to its investment in the National Immigration Control System (SKIN) that was terminated.
Prestariang’s independent auditors, Messrs Crowe Malaysia PLT has included a statement of material uncertainty related to going concern in its independent auditors’ report dated Sept 19, 2019 with respect to its financial statements for the financial period ended June 30, 2019.
Prestariang COO Baldesh Singh said the group is no longer investing in SKIN on an ongoing basis and all the staff related to the project have been let go. “Hence, the problem has gone away in that respect but unfortunately it has tied up a lot of our capital,“ he explained.
Prestariang is currently working to free up and redeploy the assets that it has in the organisation to generate income for the business operation, including an office that was acquired for the SKIN project, according to Baldesh.
The court proceedings for Prestariang’s legal action over the termination has been set for July 1, 2020. Concurrently, the group is also in the midst of mediation with the government regarding the compensation, which is independent from the legal proceedings.
“We want to speed up the process and explore the options as we have shareholders that need clarity on the matter,“ he explained.
Abu Hassan said the group has been kept in the dark on the reason for the termination, as the government is not obliged to offer an explanation according to the provision of the contract.
Last April, the group filed a suit to seek RM732.86 million in damages from the government for unilaterally terminating the RM3.5 billion SKIN project on Jan 22, 2019.
Moving forward, he said Prestariang is eyeing to partner with global technology players to explore new business opportunities.
