Rich Capital terminates consultancy services for Batam project

RICH Capital Holdings on Friday announced that the  structural consultancy services provided by Aricipta Semesta for a project in Batam have been discontinued because its terms of demand were not met by Oxley Karya Indo Batam (OKIB).

Karya Indo Batam had partnered with an indirect subsidiary of Rich Capital, Oxley Batam, to form an equal joint-venture company, OKIB, to undertake the integrated Batam project, the Oxley Batam Convention City Project. 

This termination follows OKIB's failure to withdraw its letter of demand and to provide the guarantee and undertaking sought by Aricipta.

The letter had been addressed to the board of directors of Rich Capital's associate company, Rich-Link Construction (RLC), Alva Lumban, Pratama Widya and Aricipta. Alva Lumban is the Indonesian company that formed a Joint Operation with RLC; Pratama Widya is the piling subcontractor engaged by RLC for the project.

The letter alleged that OKIB had suffered a material loss of S$5.3 million and immaterial losses of S$110 million from "mistakes  allegedly been made in the construction work". As a result, OKIB sought a S$5.3 million compensation or the removal of the piles embedded on its land. 

In addition to the withdrawl of OKIB's letter of demand, Aricipta was seeking a guarantee and undertaking for OKIB to assume full responsibility of all risks and liability related to claims, demands, protests, lawsuits, in the event that Aricipta is sued or claimed against. 

It is also demanding OKIB  bear the cost of interviews and statements given. The cost of time spent to attend calls and provide information must also be incurred by OKIB based on Aricipta's standard professional hourly rates.