1. INTRODUCTION
The Board of Directors of Nestcon (“the Board”) wishes to announce that its wholly-owned subsidiary, Nestcon Infra Sdn. Bhd. (“Nestcon Infra”), had on 14 July 2021 accepted the letter of award dated 14 July 2021 (“LOA”) awarded by Nexus EC Sdn. Bhd. (“Nexus EC”) in respect of the rock stabilisation works for the proposed development project undertaken by Mightyprop Sdn. Bhd. (“Developer”) for the 61 acres of mixed development which consist of the construction of 20 blocks office tower, 5 blocks serviced apartment and SoHo, 6 blocks serviced apartment and affordable home, business spaces, hotel, private school, auditorium and other relevant facilities that erected on the lands held under Lots PT 50935 (HSD 321517), PT 51550 (HSD 321459), PT 51551 (HSD 321460), PT 51552 (HSD 321518), PT 50934 (HSD 321516) and Lot 84846 (PN 116648), Jalan PJU 8/8, Damansara Perdana, Mukim Sungai Buloh, Daerah Petaling, Selangor Darul Ehsan.
2. INFORMATION ON NESTCON INFRA
Nestcon Infra was incorporated in Malaysia as a private company limited by shares and it is a wholly-owned subsidiary of the Company.
Nestcon Infra is principally involved in construction works.
3. INFORMATION ON NEXUS EC
Nexus EC is the geotechnical engineering consultant acting on behalf of the Developer. The business address of Nexus EC is situated at No. 86-2, Jalan Puteri 5/5, Bandar Puteri, 47100 Puchong, Selangor.
4. INFORMATION ON DEVELOPER
The Developer was incorporated in Malaysia as a private company limited by shares and it is a housing developer. The Developer is a wholly-owned subsidiary of Exsim Development Sdn. Bhd.
5. DETAILS OF THE LOA
(a) The contract works to be undertaken by Nestcon Infra pursuant to the LOA comprise the construction and completion of the site clearance, earthworks, rock blasting works, geogrid walls works, road and drainage works (“Works”).
(b) Nestcon Infra and Developer will be executing a formal contract documents to outline all conditions of the Works, amongst others, drawings, conditions of contract, specifications, bills of quantities and other relevant documents which shall be mutually agreed by both parties.
(c) The contract sum for the Works is a firm price sum of RM31,339,051.80, and payment shall be made to Nestcon Infra progressively based on the progress of the work completed as certified by the engineer or quantity surveyor.
(d) The date of commencement of the Works shall be 21 July 2021, subject to the lifting of movement control order or enhanced movement control order by the Government and/or Nestcon Infra obtained the approval from the Ministry of International Trade and Industry to commence works. The overall construction period for the Works inclusive of obtaining the relevant authorities’ approval and mobilisation period shall be within 18 months from the date of commencement.
(e) The defects liability period of the Works shall be 27 months commencing from the date of issuance of the Certificate of Completion of the Works.
6. FINANCIAL EFFECTS
The acceptance of the LOA to undertake the Works 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 2021 and throughout the duration of the Works.
7. RISK FACTORS
The Company does not foresee any exceptional risk other than the normal operational risks associated with the LOA and/or Works. Nevertheless, the Company will take the necessary steps to mitigate the risks as and when they occur.
8. 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 Works.
9. STATEMENT BY THE BOARD OF DIRECTORS
The Board is of the opinion that the LOA and the Works 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 14 July 2021.