KUALA LUMPUR (Feb 3): PN17-listed Sentoria Group Bhd has commenced legal action against OCBC Bank (Malaysia) Bhd, filing a writ in the High Court of Malaya to challenge the validity of corporate guarantees tied to two of its subsidiaries.
In a filing made on Tuesday, the group said the writ was lodged on Jan 30 and concerns corporate guarantees issued in favour of OCBC Bank for Sentoria Borneo Land Sdn Bhd and Sentoria Borneo Samariang Sdn Bhd. Both companies are wholly owned by Sentoria and are currently placed under receivership and management.
Sentoria is seeking a court declaration that the guarantees are unenforceable, alongside an order to set them aside. In addition, the group is claiming compensation or damages amounting to RM679 million.
The company noted that the writ has yet to be served on OCBC Bank, but is expected to be delivered within six months from the date of filing.
The legal dispute follows Sentoria’s announcement in April last year that receivers and managers had been appointed over the two Borneo-based subsidiaries after they failed to meet loan repayment obligations by the March 28, 2025 deadline.
Sentoria Borneo Samariang, classified as a major subsidiary, recorded negative net assets of RM29.7 million as at Sept 30, 2023, representing approximately 18% of the group’s total assets. Sentoria Borneo Land, which is not categorised as a major subsidiary, reported negative net assets of RM48.7 million during the same period.
At the group level, Sentoria posted a net loss of RM89.04 million on revenue of RM7.55 million for the financial year ended Sept 30, 2024. The company has remained in the red since FY2019 and was classified under PN17 in December 2024 after shareholders’ equity fell to 33% of its issued and paid-up capital.
Earlier this month, Bursa Malaysia granted Sentoria a six-month extension until June 3, 2026, to submit its regularisation plan aimed at resolving its PN17 status.
While Sentoria’s assets are largely outside the Klang Valley, the case underscores broader financing and corporate governance risks facing property-linked companies, including those involved in commercial property in KL and industrial developments nationwide. Lenders and developers active in industrial land in Selangor, office space in Bukit Jalil, factory developments in Puchong, and industrial property in the Subang area continue to place heightened emphasis on balance sheet strength and guarantee structures amid tighter credit conditions.
Sentoria shares were unchanged at 1.5 sen at the midday trading break on Tuesday, valuing the group at approximately RM9.34 million.
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