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Categories
| Minetech files suit against its Chinese partner |
| Business & Market 2009 | |||
| Written by Tony C H Goh | |||
| Tuesday, 03 November 2009 10:58 | |||
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MMB, in which Minetech owns a 70% stake through another subsidiary, had on Sept 9 last year entered into a 10-year lease agreement with HuiZhou for the use of a completed factory and land, office, together with machineries and other facilities for the production of autoclaved aerated concrete blocks. Under the lease agreement, MMB is required to pay three million yuan as lease deposit and a lease rental of 3.7 million yuan per annum. MMB had paid two million yuan to the defendant as lease deposit as at to date. In a reply to the local stock exchange yesterday, Minetech said while the factory facilities have been handed over to MMB, HuiZhou did not fulfil certain terms and conditions as stipulated under the lease agreement and MMB was unable to carry out production as planned. MMB filed a suit on Sept 14, 2009, after HuiZhou refused to pay the compensations. Instead, HuiZhou has now filed a counter suit against MMB claiming among others, the payment for the balance of the lease deposit of one million yuan, 3.08 million yuan in outstanding lease rental and RMB1.85 million in interest. The expected losses to the group arising from the counter-suit would be 70% of the amount claimed by HuiZhou, said Minetech, adding that MMB has not commenced business operation and has not contributed to the revenue and profit of the group. This article appeared in The Edge Financial Daily, November 3, 2009.
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