PETALING JAYA:Toyo Ventures Holdings Bhd
’s power project in Vietnam has been terminated by the Industry and Trade Ministry of Vietnam (MOIT).
In a filing with Bursa Malaysia, the premium printing ink and masterbatch for packaging industry player said its wholly-owned subsidiary, Song Hau 2 Power Company Ltd (SH2P), had received a letter from MOIT stating that the 90-day period since the issuance of the “Notice of Intention to Terminate” to the group has expired.
However, SH2P has still not remedied the financial arrangement for the project which resulted in the effective termination of the build-operate-transfer (BOT) contract for the project by MOIT, which is in pursuant to Article 23.4 of the contract.
“At this time, the company is evaluating the implications of the notice and will be seeking legal advice to explore appropriate actions and remedies as per the terms of the BOT contract.
“As the company navigate through this phase, any significant developments concerning the notice and/or the project will be promptly communicated through subsequent announcements,” Toyo Ventures stated. Toyo Ventures shares plunged by 23% or 32 sen to RM1.06 a share yesterday.
Earlier this week, Toyo Ventures announced a delay in commencing the engineering, procurement, commissioning and construction works for its thermal power plant project in Vietnam, extending the start date to on or before Dec 31, 2024.
In a filing with Bursa Malaysia, the group stated it had entered into a second addendum with Sunway Construction Sdn Bhd and Power Engineering Consulting Joint Stock Company 2 for construction works.
In April, Toyo Ventures had received a “notice of intention to terminate” from the Vietnamese government.
“The said MOIT letter serves to notify SH2P of the ‘Developer Side Default’ pursuant to Article 23.4 of the BOT Contract, if the financing arrangement for the Project is not remedied by June 30, 2024.
“Financial close of the project is maintained by June 2024, where all the lenders are currently processing the financing documents led by the exclusive mandated lead arranger,” the filing read.
SH2P, a wholly owned subsidiary of Toyo Ink Group Bhd (TIGB) was incorporated in December 2020 in Vietnam to undertake the development of 2 x 1,060 MW coal-fired thermal power plant project in Song Hau Power Complex, Hau Giang Province, Vietnam.
In its 2023 annual report, the group said the power plant would be using ultra-super critical technology which will greatly reduce emission of carbon. In December 2020, TIGB and SH2P executed the project agreements for the investment and development of “Song Hau 2 Thermal Power Plant Project” in Vietnam.
Toyo Ventures also noted it managed to secure a mandated lead arrangement for proposed syndicated financing facilities, facilitated by Export-Import Bank of Malaysia Bhd in late 2022.
The group noted that it also collaborated with reputable partners, namely Power Engineering Consulting Joint Stock Company 2 and Sunway Construction Sdn Bhd, to undertake the development of the project.
