The government will revoke the contract with National Feedlot Corporation (NFC) for failing to repay a RM250 million loan.

Prime Minister Datuk Seri Najib Razak said the NFC failed to repay the loan installment on January 9 (due date).

"The government sent a notice of remedy to NFC on May 5 and gave it 90 days to comply. However, the NFC failed to remedy the situation.

"As follow up, the government filed a notice of default on September 4 to revoke the contract and will take legal action," he said in a written reply to a question from Khalid Abdul Samad (PAS-Shah Alam) in Dewan Rakyat today.

Khalid had asked the Finance Minister to inform Parliament about the status of efforts to recover the RM250 million loan given to the NFC.

Najib, who is also Finance Minister said the RM250 million loan was to be repaid from 2012 until 2028.

"Until September 30, the repayment collected was RM34.98 million for the 2012 and 2013 installments," he added.

The NFC is alleged to have misused the RM250 million government loan meant for the national cattle rearing project.