(Unless otherwise indicated, the abbreviations used herein are the same as those previously defined in the announcement dated 10 September 2012.)

Further to our announcement on 10 September 2012, we wish to announce that Mula Holdings Sdn Bhd (“Mula”) failed to pay the Settlement Sum and all other amounts due to MIB under the terms of the Settlement Agreement dated 7 September 2012 (“Settlement Agreement”). Accordingly, the Settlement Agreement automatically terminated and MIB’s right to receive payment of the full amount of RM301,506,429 as at 30 June 2012 (“Full Outstanding Amount”) that MIB had previously advanced to Bestari Sepang Sdn Bhd, Spanstead Sdn Bhd and Seri Ehsan (Sepang) Sdn Bhd (“Seri Ehsan”) (collectively “Bestari Group”) was reinstated, and MIB holds the titles to the land belonging to Seri Ehsan (“the Land”) as security for the Full Outstanding Amount and an irrevocable Power of Attorney to deal with the Land.

As Bestari Group failed to settle the Full Outstanding Amount coupled with Mula’s refusal to accept the automatic termination of the Settlement Agreement and attempt to sell the Land in breach of MIB’s security interests, MIB filed a Writ of Summons and Statement of Claim against Mula and Bestari Group on 30 January 2015. Mula and Bestari Group then filed their Defence and Counterclaim on 9 February 2015. Thereafter, MIB filed its Reply and Defence to Counterclaim on 18 February 2015. The trial has been fixed on 15 to 18 February 2016.

The outcome of this litigation is not expected to have any material financial and operational impact on MIB Group as the net receivables in MIB’s accounts of RM103 million is below 5% of the net assets of MIB Group. Furthermore, the net receivables are secured by the Land.  MIB is pursuing the Full Outstanding Amount of RM301,506,429 as at 30 June 2012 and if successful, MIB expects to be able to recover substantially more than the net receivables of RM103 million. The net receivables recognized in MIB’s accounts have been reduced to RM103 million, mainly due to past impairments and the loss incurred upon disposal of Bestari Sepang Sdn Bhd.

MIB’s solicitors have advised that MIB has a strong case based on contemporaneous documentary evidence and the express terms of the documents with Mula and Bestari Group. Accordingly, it will be forcefully argued that the counterclaim filed by Mula and Bestari Group is without merit.

This announcement is dated 11 November 2015.