ELECTRONICS manufacturing service (EMS) provider ATA IMS Bhd has confirmed a news report that Dyson Operations Pte Ltd and Dyson Manufacturing Sdn Bhd have terminated three contracts with its wholly-owned unit, ATA Industrial (M) Sdn Bhd (ATAIM), effective June 1, 2022.

“Dyson Operations and Dyson Manufacturing had issued the notices of termination without cause pursuant to the terms of the respective contracts,” ATA IMS said in a filing with Bursa Malaysia today.

The company said its board of directors was taking advice on the validity of the notices of termination.

Until the termination date, it said, Dyson and ATA IMS would continue to fully perform their respective obligations under the contracts.

“For ATA, this shall include continuing to manufacture and supply products, components and tooling, and continuing to provide services, for and on behalf of Dyson and its affiliates, in accordance with the terms of the contracts,” it added.

The three contracts are the contract manufacturing agreement dated October 15, 2020, between Dyson Operations and ATAIM, the agreement for the supply of goods and services dated March 1, 2013, between Dyson Manufacturing and ATAIM, and the framework agreement for the supply of goods (tooling) dated June 17, 2009, between Dyson Manufacturing and ATAIM.

ATA IMS said its board also noted a Reuters news article on November 25, 2021, in which references had been made to the termination of the contracts by Dyson Operation and Dyson Manufacturing and to an audit of the company’s labour practices.

The EMS provider confirmed that prior to the receipt of the notices of termination, it had been in discussions with Dyson regarding the findings of the audit.”

“The company further notes that it had taken immediate steps upon being notified of the summary of the audit to engage Dyson in discussions and to engage professional advisers to assist the company to review, verify and validate the findings of the audit.

“Notwithstanding the receipt of the notices of termination, the company will continue to actively look into the findings of the audit,” ATA IMS said.

Its shares ended the morning session today down 35 sen, or 29.92%, to 82 sen with 72.40 million shares traded. – Bernama, November 25, 2021.