KUALA LUMPUR (Sept 2): DRB-Hicom Bhd (KL:DRBHICOM) said it has received a notice of assessment from the Inland Revenue Board (LHDN), amounting to RM246.25 million for the year of assessment 2020.

The notice was pursuant to LHDN’s decision “to treat the disposal of a long-term investment held in a subsidiary as income” in the assessment year, DRB-Hicom said.

The group intends to appeal and potentially initiate legal proceedings to challenge the notice, it said.

In 2020, DRB-Hicom conducted a slew of disposals, including property assets, as part of a restructuring exercise.

This includes the disposal of its 70.6% effective interest in Horsedale Development Bhd, which manages Holiday Inn Kuala Lumpur Glenmarie and Glenmarie Golf & Country Club, for RM347.17 million.

It also sold 100% in Rebak Island Marina Bhd, which manages the Rebark Island Resort & Marina in Langkawi island, for RM170.44 million.

Also disposed of were various property assets for RM1.43 billion.

The assets were sold in a related party transaction to Kelana Ventures Sdn Bhd and its subsidiary Prisma Dimensi Sdn Bhd. Kelana Ventures is controlled by Tan Sri Syed Mokhtar Al-Bukhary, who also has an indirect interest of 55.92% in DRB-Hicom.

In return for the RM1.95 billion disposals, DRB-Hicom received 1,243 acres of freehold land in Tebrau, Johor Bahru, valued at RM1.65 billion, and cash of RM288.71 million, with the remaining RM15.4 million relating to contingent considerations to be fully satisfied by 2025.

Shares of DRB-Hicom traded four sen or 3.42% lower at noon market break on Monday, giving it a market capitalisation of RM2.18 billion. The counter is down 18.7% this year.

https://www.theedgemarkets.com/node/725162