Bursa reprimands Ireka, fines directors RM425,000 over Pan Borneo Sabah project disclosure breaches

KUALA LUMPUR (May 13): Bursa Malaysia Securities Bhd has publicly reprimanded Ireka Corporation Bhd and fined seven of its directors a total of RM425,000 for breaching Main Market Listing Requirements. The penalties stem from disclosure failures related to the RM1.07 billion Pan Borneo Highway project in Sabah.

In a statement on Monday, the bourse regulator said the disclosure-related breaches involved a letter of award (LOA), failure to update the status of an article of agreement (AOA), and delayed disclosure of the project termination.

Although Ireka was delisted on March 10, 2026, the breaches were committed when the group was still listed on the official list, said Bursa.

The seven who were levied, comprising past and present directors, were:

- Datuk Mohd Hasnul Ismar Mohd Ismail (former group managing director) and Chairil Mohd Tamil (deputy managing director), who were both fined RM100,000 each;

- Simon Chow Sung Chek (former executive director), who was fined RM75,000;

- Tan Sri Mohd Ismail Che Rus (former non-independent, non-executive chairman) and Shahruladeri Mohamad Adnan (former independent, non-executive director), who were each fined RM50,000;

- and Datuk Azmi Abdullah (former senior independent, non-executive director) and Norhaizam Mohammad (independent non-executive director), who were fined RM25,000 each.

Bursa said the penalties were imposed after considering the materiality of the breaches, their impact on investors, and the directors’ respective roles, responsibilities, knowledge, involvement and conduct.

Ireka breached the listing requirements by failing to ensure its Oct 8, 2024 announcement on the LOA for the Pan Borneo Sabah Phase 1B project was factual, accurate and sufficiently detailed for investors to make informed decisions.

Bursa identified three primary areas where Ireka failed to meet listing requirements:

1. Inaccurate initial announcements: The LOA was awarded by Gammerlite Sdn Bhd to Ireka’s wholly owned unit Shoraka Construction Sdn Bhd (SCSB) for subcontract works under the Project Pan Borneo project in Sabah Phase 1B, which involved the upgrading of the road from Kampung Lomou Baru to Kampung Toupus. However, Ireka's announcement on Oct 8, 2024 failed to disclose that the project involved a multi-level subcontracting structure, making SCSB the third company awarded the project. It also omitted that the LOA was subject to funding availability and approvals from the Public Works Department (JKR) and main contractor MTD Construction Sdn Bhd.

2. Failure to update LOA status: Ireka failed to immediately announce the execution status of the LOA within the stipulated Nov 21, 2024 deadline, as well as the extended deadlines of Feb 21, 2025 and May 21, 2025.

3. Delayed termination notice: The project operation agreement between MTD Construction and Gammerlite was terminated on June 30, 2025, resulting in the loss of the LOA. But Ireka, despite being informed of the termination on July 1 and getting the official notice from Gammerlite on July 9, delayed its public announcement until July 28 that year.

Bursa said the initial omissions deprived investors for a complete understanding of the project's risks, particularly the threat of termination if approvals and funding were not secured. It also highlighted that the RM1.07 billion contract was “highly material” to Ireka, far exceeding 10% of its consolidated revenue of RM36.82 million for the financial year ended June 30, 2024.

The inadequate disclosures led to significant market volatility. Ireka’s share price, which surged 45% following the Oct 8, 2024 announcement, plunged 77% between July 1 and July 29, 2025 after the project termination was finally made public.

Bursa said it views the contraventions seriously as timely, full and accurate disclosure of material information to enable investors to make informed decision is of paramount importance in ensuring an orderly and fair market, as well as to maintain market integrity and investor confidence.

Read also:
Ireka to be delisted on March 10

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