1. Introduction

The Board of Directors of ATA IMS Berhad (“ATAIMS” or “the Company”) wishes to announce that on 20 April 2023, its wholly owned subsidiary ATA Industrial (M) Sdn Bhd had received a sealed copy of Writ of Summons and Statement of Claim dated 18 April 2023 filed by Intag Industrial Supplies Sdn Bhd via suit no. JA-22NCC-29-04/2023 filed in the High Court of Malaya at Johor Bahru, Johor.

2. Circumstances leading to the filing of the Writ of Summons and Statement of Claim against the Defendant

The Plaintiff is a company incorporated in Malaysia, with principal activities in converting and distribution of industrial tapes, adhesives, and other products. The Plaintiff supplies goods to the Defendant, which are used solely in the assembly of products for one of the Defendant’s customers, based on the customer’s order forecasts.

On 25 November 2021, the Company announced that the customer had terminated its business contracts with the Defendant with effect from 1 June 2022. The Plaintiff claims that as at end December 2022, they have a stockholding of RM2,579,217.84, which the Defendant had yet to instruct the Plaintiff to deliver the goods, and in January 2023, the Plaintiff sent notices to the Defendant to take delivery of the goods and to pay the amount of RM2,579,217.84.

In March 2023, the Defendant informed the Plaintiff that the Company was in discussion with the customer and shall revert to them once a proposed resolution can be worked out. The Plaintiff thus proceeded with legal action before any proposed resolution with the customer.

3. Details of the Claim

The details of the Claim are as follows :

(i)  RM2,579,217.84,

(ii)  Interest on the sum of RM2,579,217.84 at the rate of 5% per annum in accordance with s.11(1) of the Civil Law Act 1956 from 9 February 2023 until the date of full settlement,

(iii)  Costs, and

(iv)  Any further or other relief deemed fit by the Honourable Court.

4. Financial and Operational Impact of the Summons and Claims

Currently the suit is not expected to have a significant impact on the operations of the Defendant and ATAIMS.

If the claim is allowed by the court, the financial impact will be the damages claimed, and any costs or interest granted.

5. Steps Taken and Proposed to be Taken in Respect of the Summons and Claims

The Group is seeking legal advice before deciding its next course of action.

The Company will make the necessary announcements to Bursa Malaysia Securities Berhad as and when there are further developments or upon receipt of further direction from the Court.

This announcement is dated 26 April 2023.