ASPEN Glove, a subsidiary of mainboard-listed Aspen Group : 1F3 0%, has on Feb 1, 2023 received a letter from Gas Malaysia Energy and Services to terminate a gas supply agreement made between the companies and to claim for payments, according to a Sunday (Feb 5) bourse filing.

Aspen Glove denies the claim and the notice of termination and demand’s validity, and intends to contest them.

The notice of termination and demand, dated Jan 31, 2023, sought an aggregate sum of about RM306.4 million (S$95.2 million) – RM838,756.77 for alleged outstanding payment, and about RM305.5 million for alleged payment for unused gas supply for the remaining contract period of the gas supply agreement. The agreement to be terminated was dated Jan 19, 2021.

According to the notice, the termination will take effect 14 days from the issue of the notice. Within this time, Aspen Glove is also required to make payment of the claim, it said, failing which Gas Malaysia Energy and Services will be entitled to take legal action against Aspen Glove without further reference, and claim all legal costs incurred against Aspen Glove.

Aspen Group said that the notice is “invalid and/or without basis” as there is no outstanding payment to Gas Malaysia Energy and Services as at the date of the notice. The gas company’s claim is “unreasonable, unlawful, excessive, an unjust enrichment and amounts to an exorbitant and unfair penalty” against Aspen Glove, it added.

The group said that Aspen Glove will contest the notice and claim and work with its solicitors on the next course of action. This will include assessing a counterclaim against Gas Malaysia Energy and Services for excess payment, loss of reputation, damages and loss suffered.

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Aspen Group shares ended unchanged at S$0.041 on Friday, before the Sunday filing.

In a separate filing on Feb 2, Aspen Group provided an update on legal proceedings with JR Engineering and Medical Technologies.

Aspen Glove had on Nov 7, 2022 received a notice dated Nov 4, 2022 from the solicitors acting for JR Engineering and Medical Technologies claiming a sum of RM22.4 million. This was allegedly a balance sum paid by JR to Aspen Glove under an agreement for JR to purchase gloves from Aspen Glove.

JR would proceed to commence winding-up proceedings against Aspen Glove, if it failed to make payment within 21 days of the notice.

Aspen Group’s update said that it has successfully obtained an interim injunction restraining JR, amongst others, from filing or presenting any winding-up petition based on the notice pending the hearing and disposal of Aspen Glove’s originating summons against JR.

“The court has also ordered that the costs of (Aspen Glove’s) application for the interim injunction be borne and paid by JR to (Aspen Glove),” the update said.