Darco Water: Issued second letter of demand to Emsus on missed payments

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  • Darco Water has received a payment of US$100,000 from Emsus Co. and Do Yun Yu.
  • Around US$813,000 in principal remains outstanding.
  • Further impairments of the outstanding amounts could have a “material impact” on financial performance.

Darco Water Technologies said Monday Emsus Co. and Do Yun Yu have made an additional payment of US$100,000 to the company toward the first settlement, but the second and third settlement payments totalling US$813,000 in principal, plus accrued interest, are outstanding.

The payments were for the reversal of the deal to acquire 75 percent of PT Panghegar Energy Indonesia.

Emsus Co. and Do Yun Yu, who is believed to be Emsus’ senior consultant and project manager, did not immediately respond to Shenton Wire’s emailed request for comment, which was sent outside of office hours.

Darco Water said it has issued a second letter of demand for a total sum of around US$817,136, including accrued interest, within seven days. If Emsus Co. and Do Yun Yu fail to pay within seven days, Darco has the right to enforce immediate and full payment, the filing said, without elaborating.

Darco Water has previously made an impairment of US$160,042 over the owed amounts.

Including the US$100,000 payment received toward the first settlement, the maximum further impairment which could be required for this year’s financial statements would be around US$652,958, Darco Water estimated.

“The Emsus further impairment will have a material impact on the financial performance of the company for FY2021,” Darco Water said, noting the impairment would amount to around 49 percent of the group’s profit before tax for 2020.

In July 2020, Darco Water had exercised its reversal option on the acquisition after the West Java government wouldn’t agree to re-negotiate terms of a cooperation agreement with PT Jabar Bersih Lestari (JBL), which was 80 percent owned by PT Panghegar Energy Indonesia.

JBL had entered a cooperation agreement with the West Java Province Regional Government of Indonesia to provide waste-management services in Bogor City, Bogor Regency and Depok City in Indonesia; that project was in its preliminary stage in November 2019, when Darco Water entered the deal to acquire the PT Panghegar Energy Indonesia stake.