1. INTRODUCTION
The Board of Directors of Nestcon (“the Board”) wishes to announce that Nestcon Builders Sdn. Bhd. (“Nestcon Builders”), a wholly-owned subsidiary of the Company, had on 10 January 2024 accepted the letter of award dated 10 January 2024 (“LOA”) awarded by Exsim Avenue Sdn. Bhd. (“Exsim Avenue”) for undertaking the construction and completion of earthworks, piling works, main building works and infrastructure works for a 37-storey mixed commercial development comprising of retail shops, strata office (220 units), service apartments (126 units), carparks and other relevant facilities (“the Contract Works”).
2. INFORMATION ON NESTCON BUILDERS
Nestcon Builders was incorporated in Malaysia as a private company limited by shares having its registered address at No. 7-1, Jalan 109F, Plaza Danau 2, Taman Danau Desa, 58100 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur, and it is a wholly-owned subsidiary of the Company.
The nature of business of Nestcon Builders is principally involved in construction works.
3. INFORMATION ON EXSIM AVENUE
Exsim Avenue was incorporated in Malaysia as a private company limited by shares and having its business address at D-35-01, Level 35, Exsim Tower, Millerz Square @ Old Klang Road, Megan Legasi, No. 357, Jalan Kelang Lama, 58000 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur.
The nature of business of Exsim Avenue is to carry on the business of developer, builders and contractors of and for all buildings, and works of any kind and among other things to construct and dwelling houses of all kinds.
4. DETAILS OF THE LOA
(a) The contract sum for the Contract Works is RM108,000,000.00 (Ringgit Malaysia One Hundred and Eight Million Only) (“the Contract Sum”).
(b) The date of commencement shall be 15 January 2024.
(c) The overall completion for the Contract Works is within Thirty-Nine (39) months and the completion date shall be 14 April 2027 or within such extended date of the conditions of contract provides.
(d) The defect liability period shall be Twenty-Seven (27) months from the date of the Certificate of Practical Completion of the Contract Works.
(e) Nestcon Builders shall carry the Contract Works in accordance with the other supplementary terms and conditions set out in the LOA.
5. FINANCIAL EFFECTS
The acceptance of the LOA by Nestcon Builders to undertake the Contract Works is expected to contribute positively to the net assets per share, earnings per share and gearing of the Company throughout the duration of the Contract Works.
6. RISK FACTORS
The Company does not foresee any exceptional risk other than the normal operational risks associated with the LOA and/or the Contract Works. Nevertheless, the Company will take the necessary steps to mitigate the risks as and when they occur.
7. APPROVAL REQUIRED
The acceptance of the LOA is not subject to the approval from the Company’s shareholders and/or any regulatory authorities.
8. DIRECTORS’ AND MAJOR SHAREHOLDERS’ AND/OR PERSONS CONNECTED WITH A DIRECTOR OR MAJOR SHAREHOLDER’S 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 the Contract Works.
9. STATEMENT BY THE BOARD OF DIRECTORS
The Board, after having considered all aspects of the LOA and the Contract Works, is of the opinion that the LOA and the Contract 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 10 January 2024.