On 22 December 2016, Malaysia Airports Holdings Berhad (the Company) issued a Notice of Arbitration (Notice) to HSS Integrated Sdn Bhd (HSSI) regarding HSSI’s breaches of its obligations under the Memorandum of Agreement dated 13 April 2010 (Memorandum of Agreement).

By way of the Memorandum of Agreement, the Company appointed HSSI to provide civil and structural consultancy services for the project known as “the Proposed Development of New Low Cost Carrier Terminal (LCCT) and Associated Services at KL International Airport” (the Project).

Disputes and/or differences have arisen between the Company and HSSI and the Company’s claim against HSSI for (a) the estimated sum of RM64,617,267.17 as at May 2016  relating to, inter alia, losses and damages it has suffered, (b) interest, (c) costs, and (d) any other/further relief that the arbitrator may deem fit and just.  Attempts have been made to amicably settle these disputes and/or differences. However, they remain unresolved. Pursuant to section 20.2 of the Memorandum of Agreement, the Company has the right to refer those disputes, claims and/or differences to arbitration. The Company has reserved its right to revise its claim and further reserved its right to state any contentions not expressly set out in the Notice of Arbitration. The Company has further reserved all its rights and remedies.

The Company has obtained a preliminary view from its solicitors who consider that the Company has a good arguable case against HSSI.

The notice of arbitration is not expected to have any material impact on the financial and operational position of the Company.

Any further updates in respect of any material development will be made from time to time.

This announcement is dated 22 December 2016.