On 22 December 2016, Malaysia Airports Holdings Berhad (the Company) issued a Notice of Arbitration (Notice) to KLIA Consultancy Services Sdn Bhd (KLIACS) regarding KLIACS’ breaches of its obligations under the Project Management Consultancy Agreement dated 15 December 2010 (PMC Agreement).

By way of the PMC Agreement, the Company appointed KLIACS to provide consultancy services for the project known as “the Proposed Development of New Low Cost Carrier Terminal (LCCT) and 3rd Runway at KL International Airport” (the Project).

Disputes and/or differences have arisen between the Company and KLIACS and the Company claims against KLIACS to be wholly or partly liable for, inter alia,  the losses and damages it has suffered estimated to be RM148,931,593.40 as at October 2016, interest, costs and 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 clause 10.2 of the PMC 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 KLIACS.

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.