A LEGAL claim for US$25.76 million (US$1 = RM3.80) has been filed againstKumpulan Guthrie Bhd by Indonesia's P.T. Adhiyasa Saranamas which isalleging breach of contract by the Malaysian company.

Adhiyasa is also applying to seize Guthrie's interests in three Indonesiancompanies as security, which can be sold through a public auction shouldit win the case.

The companies are PT Salim Ivomas Pratama (in which Guthrie holds a 20 percent stake), PT Serikat Putra (21.59 per cent) and PT Guthrie PecconinaIndonesia (70 per cent).

Guthrie's Indonesian counsels have advised it to resist the suit.

The group is also assisted in the case by a counsel from the US, Guthrietold the Kuala Lumpur Stock Exchange on Monday.

Guthrie did not disclose details of the contract that it had allegedlybreached.

In the first hearing held on Monday, Guthrie was granted an extension forits Indonesian lawyers to file a defence and to seek to strike outAdhiyasa's application to seize Guthrie's interests in the threecompanies.

Separately, Guthrie and its director Tan Sri Abdul Khalid Ibrahim havefiled a defamation suit in the High Court of Malaya, Kuala Lumpur, againstAdhiyasa and one Gilbert Wiryadinata.

Shares of Guthrie lost one sen to close at RM2.12 yesterday.

Guthrie had last month finalised its purchase of more than 200,000ha ofplantation land from the Indonesian Bank Restructuring Agency for someUS$368 million.

The Indonesian government agency had taken control of the estates from itsbiggest debtor, the Salim Group, which has more than 100 companies in itsstable.

The group had owed about 53 trillion rupiah (100 rupiah = RM0.04) orRM23.81 billion.

The estates were later sold through a competitive bidding process in whichGuthrie emerged the winner.

The purchase, financed by a RM1.5 billion Islamic syndicated loan, wasexpected to boost Guthrie's crude palm oil production 300 per cent by theyear 2005.

15 August 2001Business Times