EcoWorld seeks RM159 mil refund for aborted Penang project

KUALA LUMPUR (June 16): Eco World Development Group Bhd (EcoWorld) signed the deed of revocation and rescission yesterday with the Penang Development Corp (PDC) after their mutual decision to rescind the award of the proposed RM10 billion Eco Marina project in Batu Kawan, Penang, to the developer.

This means the letter of award given to EcoWorld, and all its respective rights and obligations, has been revoked and rescinded, it said in a bourse filing.

As such, PDC will have to refund the initial payments of the purchase and lease consideration, and earnest deposit, interest-free, within a month, with an automatic extension of another one month thereafter.

The refund would amount to RM159.25 million, which comprises a RM156.25 million initial payment for the purchase and lease consideration, and RM3 million earnest deposit, for the 182ha plot of land on which the mixed development was planned.

The land, which costs RM796.27 million, would have also featured an 18-hole golf course and clubhouse.

The project was mutually rescinded on June 8 after Eco-World said studies done during the detailed planning process had revealed that the acreage required for the golf course was significantly higher than originally assumed, which adversely affected the viability of the project.

PDC said it would call for fresh bids for the project.

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This article first appeared in The Edge Financial Daily, on June 16, 2016. Subscribe to The Edge Financial Daily here.