Koh Brothers shares continue tumble over significant exposure from major legal disputes
The total liability exposure makes up a fifth of Koh Eco’s market capitalisation
On August 19, the shares of Koh Brothers Eco Engineering (Koh Eco) continued to decline, suffering a 6% drop to S$0.097, following disclosure of three major legal disputes on the previous day. These disputes could potentially expose the company to around S$57.6 million in liabilities, accounting for a fifth of its market capitalization of approximately S$290 million.
By 11:23 AM, the company's shares had fallen to S$0.098, still 4.9% lower than their price at the start of the day. Meanwhile, the parent company Koh Brothers Group experienced a 11.1% drop, reaching as low as S$0.24 before recovering slightly to S$0.25, which still represented a 7.4% decrease. On August 6, Koh Eco had reported that the Singapore High Court had dismissed applications by its subsidiary, Koh Brothers Building & Civil Engineering Contractor (KBCE), seeking to overturn partial arbitration awards.
The company faced a joint-venture dispute with a potential maximum exposure of S$20.5 million, as well as a S$23.3 million consortium arbitration and a subcontractor claim of up to S$13.78 million. Despite these legal battles, Koh Eco plans to file a counterclaim against the subcontractor, and has not yet made financial provisions for these suits.
Written by urgent.news from The Business Times - Companies & Markets's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
