Unpaid claims by contractors a misunderstanding, says SFI

KOTA KINABALU: Sabah Forest Industries Sdn Bhd (SFI) has commenced disbursing payments to its contractors since November 5.

Head of Raw Materials at SFI, K.L. Ho confirmed that the payments have been given to contractors and that the company would continue to do so when contacted by phone yesterday.

Ho said SFI has received funding from an investor of which RM30 million has been allocated for payments to contractors.

Ho said the claim by a group of 11 contractors who alleged that the former state-owned entity had failed to pay RM70 million owed to them for various jobs undertaken was just a misunderstanding.

SFI stated that the payments were in line with the commitment made by SFI senior management earlier in October.

“The senior management (of SFI) has promised to pay the contractors by the end of October.”

After SFI received the transfer of funds by investors, the company commenced the payment to contractors starting November 5, he said.

Meanwhile, one of the contractors, Kinta Insan Sdn Bhd managing director Yong Oi Kiong said he has received the ongoing payment from SFI.

On behalf of the contractors, Yong thanked SFI senior management for being considerate towards them.

SFI was a state-owned entity managed by majority equity holder Lions Group Holdings since early 1994, before a takeover in 2007 by Ballapur Industries Limited (BILT), India’s largest manufacturer of writing and printing paper.

A member of one of India’s leading business conglomerates – the USD4 billion Avantha Group – BILT accounts for over 53% of the coated wood-free paper market, an impressive 8 0% of the bond paper market and nearly 35% of the hi-bright Maplitho market, besides being India’s largest exporter of coated and uncoated paper, according to Business Week Report online.