SINGAPORE - Catalist-listed Singapore eDevelopment, formerly known as CCM Group, has been asked to pay $152,509.68 to an insurer, who had to pay out the same sum to one of the company's clients.
MSIG Insurance had issued a performance bond for a contract between CCM and the National Parks Board (NPB), for maintenance and upgrading of park facilities.
NPB has since demanded and obtained payment of $152,509.68 under the performance bond.
A performance bond is commonly used in the construction industry to insure against the risk of a contractor failing to fulfil obligations.
Since Singapore eDevelopment had provided corporate indemnities to issuers of performance bonds relating to its legacy construction business, it will now have to pay the demanded sum to MSIG.
This is not expected to have a material impact on the company's financial results for the year, it said in an exchange filing on Friday (Nov 4).