By INS Contributors
KUALA LUMPUR (April 16)--The Kuala Lumpur High Court dismissed a US 25 million suit by Singapore’s CapAsia Solar One Ltd against several Malaysian defendants on Thursday, in a case that will impact Malaysia’s solar energy industry.
CapAsia’s application for a summary judgment for the sum of US 25,600,347 (RM 105,588,631) with costs to be paid to the defendants who include against Sun Energy Ventures Holdings (Labuan) Ltd, Sun Energy Ventures Sdn Bhd, SEV Renewables Sdn Bhd, Nice Hectares Sdn Bhd and several individuals.
If successful, the attempt by CapAsia would have seen it seize control of the defendant companies, companies which have a stake in the country’s solar energy industry, potentially striking a blow to local efforts at developing the industry.
CapAsia had first entered into a master investment agreement (MIA) with the defendants in 2013. Under the terms of the MIA, CapAsia would provide equity financing to the defendants’ photovoltaic solar energy development projects in exchange for returns on its investment.
CapAsia claims that the defendants are purportedly in breach of the MIA, which forms the main basis for CapAsia’s action, which is claiming the aforementioned sum with interest of 15 percent a year, until full and final settlement, against the defendants.
CapAsia is also claiming for specific performance of certain memorandum of deposit of shares, which will allow CapAsia to seize control of the defendant companies.
Should CapAsia succeed in its bid, Malaysia’s solar energy industry could face a serious setback, especially as the government’s keen interest in developing solar energy as one of the significant sources of energy in the country, which has a promising potential to establish large scale solar power installations.
Malaysia is situated at the equatorial region with an average solar radiation of 400–600 MJ/m2 per month, making the industry a potentially lucrative one.
According to the 9th Malaysia Plan (9MP), a large allocation had been dedicated for implementation of solar PV systems. In 2005, a Malaysian Building Integrated Photovoltaic (MBIPV) project was announced and it was planned to end by 2010.
CapAsia had earlier applied for injunctive relief at the commencement of the action. A consent order was subsequently entered between CapAsia and the Defendants in terms of the said injunctive relief.
Despite having an injunction in place to secure its rights, CapAsia pursued relief for a receiver and manager to be appointed against the defendant companies mentioned above. However, Jan 8, the court dismissed CapAsia’s application for the appointment of a receiver and manager.
There is no appeal against the court’s decision on this and the time to file such an appeal has lapsed. CapAsia then filed an application for summary judgment against the defendants for the entire sum sought in their claim along with reliefs of specific performance.
Lawyer for the defendants, R Rishi, when contacted informed INS that in dismissing CapAsia’s application for summary judgment, the court found that there were issues in dispute between the parties, which should be ventilated through a full trial.
One of these issues concerns the pertinent question as to whether the Memorandum of Understanding signed between the plaintiff and the defendants in 2017, which the defendants say had novated / varied the MIA, is enforceable against the parties concerned.
The matter has been fixed for trial on Jan 5-7, next year.
Singaporean public listed company loses US 25 million bid sparing local solar energy industry a serious setback
By INS Contributors