KUALA LUMPUR (June 21): Tenaga Nasional Bhd (TNB) and Malakoff Corp Bhd’s joint venture company, Kapar Energy Ventures Sdn Bhd (KEV), has ironed out its RM595.95 million tax dispute with the Inland Revenue Board (IRB).

After reaching the out-of-court settlement, KEV has withdrawn its judicial review application at the High Court to challenge the notices of assessment from the IRB amounting to RM595.95 million, according to Malakoff’s bourse filing on Wednesday (June 21).

“The out-of-court settlement is not expected to have any material impact on the earnings and net assets of Malakoff for the financial year ending Dec 31, 2023 (FY2023),” it added.

This was also corroborated by TNB’s filing, which noted the settlement has no material impact on the utility giant's financial position.

The quantum of the out-of-court settlement was undisclosed.

KEV is a 40%-associate of Malakoff, with the remaining 60% stake held by TNB's wholly-owned unit TNB Power Generation Sdn Bhd.

KEV, on Nov 1, 2021, received notices of assessment for the years 2011, 2012 and 2014, and notices of additional assessment for 2013, 2015, 2016, 2017 and 2018, all dated Oct 29, 2021, amounting in the aggregate to RM595.95 million.

KEV had filed its judicial review application to challenge the notices on Nov 16, 2021.

KEV operates the second-largest thermal power plant in Malaysia with a generation capacity of 2,200MW. It is the only power station in Malaysia with triple fuel firing capability (gas, oil and coal).

Shares in Malakoff closed half a sen or 0.86% higher at 58.5 sen, giving the group a market capitalisation of RM2.9 billion.

Meanwhile, TNB ended three sen or 0.33% lower at RM9.19, valuing the group at RM53.18 billion.

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TNB-Malakoff unit in out-of-court settlement talks with IRB over RM596 mil tax dispute