Singapore eDevelopment asked by Coface to pay guaranteed sum of S$3.4m

SINGAPORE eDevelopment said on Tuesday the company has been called upon by the Compagnie Française d'Assurance pour le Commerce Extérieur (Coface) - an insurance company and issuer of the performance bond relating to the building works at Jurong West Neighbourhood 2 Contract 19 - to pay the guaranteed sum of S$3.4 million.

This is in accordance with the Legacy Corporate Indemnity relating to the Jurong West Performance Bond following the failure by CCM Industrial Pte Ltd (CIPL) - a previously wholly owned subsidiary of Singapore eDevelopment that was disposed off on May 21, 2014 - to pay the same pursuant to an agreement of counter indemnity relating to the Jurong West Performance Bond between CIPL and Coface.

"The company is currently in negotiations with Coface for the settlement of the company's liabilities to Coface incurred pursuant to the Legacy Corporate Indemnity relating to the Jurong West Performance Bond through payment in stages," it added.

The payment is currently not expected to have a material impact on the financial results for the current year ending Dec 31, 2015.

On June 9, Singapore eDevelopment announced that the Housing & Development Board (HDB), the project owner, had demanded payment of S$2.8 million by Coface under the Jurong West Performance Bond. The demanded sum is a partial sum claimed against the sum guaranteed of S$3.4 million under the Jurong West Performance Bond and that the HDB reserves its right to make further claims against its remaining balance.