S P Setia terminates JV agreement with PPH Resorts

PETALING JAYA: Setia Promenade Sdn Bhd, a wholly owned subsidiary of S P Setia Bhd, has terminated a joint-venture agreement with PPH Resorts (Penang) Sdn Bhd for the proposed development of a 45-acre freehold land in Penang Island, citing among other reasons, failure of common purpose of the agreement.

The agreement was first announced on Dec 12, 2006, and since then, an approximately RM12.2 million has been spent by Setia Promenade on the project. A writ of summons and statement of claim have been filed by Setia Promenade to recover the cost incurred, initial funding and interest on the funding.

In response, PPH Resorts has filed a counter-action on March 12, 2010, for the recovery of an earlier agreed payment of RM5.72 million should the development be profitable, as well as damages allegedly suffered.