A Sibu-based company, Gabung Trading Sdn Bhd, has petitioned to the Kuching High Court for the winding-up of the troubled Borneo Pulp & Paper Sdn Bhd which is involved in a multi-billion ringgit pulp-and-paper project in Bintulu over claims the respondent company failed to settle.

The winding-up notice was published in a local English-language daily Sarawak Tribune today. Malaysiakini has not been able to ascertain the amount owed by Borneo Pulp & Paper, which led to the winding-up action.

A Kuching-based legal firm George Lo & Partners, acting as advocates for the petitioner Gabung Trading Sdn Bhd which is part of the KTS Group of Companies confirmed the winding-up petition but declined to give details.

Borneo Pulp and Paper, formerly known as Borneo Pulp and Paper Industries Sdn Bhd, has been placed under receivership and today's advertisement notice states that a receiver and manager has been appointed for the company.

Project to cost over RM5.3 billion

Borneo Pulp and Paper was majority-owned by Indonesia-based Asia Pulp and Paper Ltd. Its parent company too faced financial problems and was subsequently de-listed from the New York Stock Exchange (NYSE).

The Sarawak state government through the state-owned Sarawak Timber Industry Development Corporation (STIDC) also holds a stake in the trouble company.

Borneo Pulp and Paper has been in the news recently because of its abandoned plantation project and a series of suits brought by natives involving native customary land rights.

The whole project, including a proposed paper mill, was to cost more than US$1.4 billion (RM5.32 billion) when fully completed.

When news first surfaced two years ago of the foreign partner's financial troubles and Asia Pulp and Paper's possible de-listing from the NYSE, the state government launched a series of actions to protect its own interests.

Land taken back

Earlier this year, after failing to obtain a favourable response to its proposal to take over Asia Pulp & Paper's interest in the company, the government exercised its rights under the Sarawak land laws to take back a sizeable piece of plantation land that had been earlier alienated to the company, with compensations to the parties concerned, including lenders.

Gabung Trading Sdn Bhd, one of the creditors, presented the winding-up petition in the High Court on Aug 26, and a hearing date has been set on Sept 20.

The address of the respondent has been given as the 10th floor, Wisma Alam Sumber in Jalan Stadium, Petra Jaya, Kuching. The building belongs to STIDC, which also has its headquarters there together with the Forestry Department.

Malaysiakini had earlier carried a report stating that Borneo Pulp and Paper had been placed under receivership based on statements made by the counsel acting for the troubled company to the Kuching High Court in a recent hearing of a native customary rights land claim case.

A spokesman for a Kuala Lumpur-based public relations agency representing STIDC had told malaysiakini its Aug 26 report that three Sarawak-based timber conglomerates would take over the ailing project under a new joint venture company was 'factually incorrect'.

The state government has so far kept mum on the issues other than that a statement released in May this year when it revealed, for the first time, problems in Borneo Pulp and Paper, and actions that it had taken to protect the interest of Sarawak and its people.