Shukaku Inc. and Singapore’s HLH Group have agreed to terminate plans that would have seen HLH pay Shukaku $14.9 million for a 1.35 hectare plot of land in Phnom Penh’s Boeng Kak neighborhood, the scene of some 3,000 forced evictions.
In an announcement on the Singapore Stock Exchange on Wednesday, HLH said the purchase agreement it announced six months ago was scrapped by mutual agreement with Shukaku, a local firm owned by CPP Senator Lao Meng Khin.
“The board wishes to announce that the seller and the buyer have mutually agreed and entered into a termination agreement on 16 December 2014 to terminate the [sale and purchase agreement] due to commercial reasons, strictly without any liability or breach of either party,” HLH said.
The announcement offers no further explanation for the deal’s demise but says HLH will get its $1.46 million deposit back.
With City Hall’s help, Shukaku evicted thousands of families over the past few years—illegally, housing rights groups say—to make room for a high-end real estate project in Boeng Kak that would cover some 120 hectares.
HLH claimed not to know about the evictions when it announced the purchase agreement in June and did not respond to a request for comment Sunday. Shukaku also did not reply to a request for comment.
Earlier this month, however, Shukaku spokeswoman Amu Pillay said the deal was unlikely to come off due to unspecified financial troubles on the part of HLH. At the time, HLH responded that money was not an issue.
HLH would have been the first company to buy into the area, which has remained undeveloped.
Despite HLH’s departure, Ms. Pillay said Shukaku is moving ahead with plans to install a drainage system at the site and build a five-story office block at the cost of a “few double-digit million U.S. dollars.”
Shukaku says City Hall has also approved a master plan for the 120-hectare site, but has refused to release a copy.
© 2014, All rights reserved.