Reference is made to Magnum’s announcements made on 6 and 23 December 2019, and 3 January 2020 pertaining to the leave for commencement of judicial review proceedings granted by the Labuan High Court to the Applicant and the subsequent updates that were provided in Magnum’s announcements on the quarterly results.

Magnum wishes to announce that the Applicant through its legal counsel with the agreement of the Respondent had today, 31 December 2020, filed a Consent Order with the Labuan High Court to enter into a Consent Judgment for the following:-

(1)  The Respondent will set aside the notices of assessment dated 29 November 2019 for the years of assessment 2014 and 2015 by issuing the notifications to waive the assessment for the said years within 30 days from the date of the Consent Order;

(2)  The Respondent will not subject the single tier dividend received by the Applicant in the year of assessment 2018 to tax and the Respondent shall issue the notification of reduced assessment for the said year to reflect the same within 30 days from the date of the Consent Order subject to documentary proof of the same;

(3)  The Respondent will waive in full the penalty imposed pursuant to Section 113(2) of the Income Tax Act 1967 in relation to the notice of assessment dated 29 November 2019 for the year of assessment 2016 and the Respondent shall issue the notification of reduced assessment for the said year to reflect the waiver of penalty rate within 30 days from the date of the Consent Order;

(4)  The Applicant will make full and final settlement of tax and penalty of RM80,620,684.56 for the remaining taxes for the years of assessment 2016, 2017 and 2018 consequent to items (1) to (3) above as follows:

      (a)  RM 60,000,000.00 on or before 31 December 2020; and

      (b)  The remaining balance of RM 20,620,684.56 in four equal installments of RM 5,155,171.14 each respectively on or before 31 January 2021, 28 February 2021, 31 March 2021 and 30 April 2021;

(5)  In view of items (1) to (4) above, both parties agree that the Applicant's tax affairs for the years of assessment 2008 to 2018 are in order and have been settled accordingly;

(6)  The Respondent will:

      (a)  not raise any form of assessment against the Applicant’s related company known as Asia 4D Company Limited, another 100%-owned Labuan Offshore subsidiary of Magnum, for the years of assessment 2008 up to 2018 including with reference to the Applicant’s audit issues and with reference to the two Respondent’s letters, both dated 9 October 2020 and Asia 4D Company Limited tax representative’s letter dated 27 October 2020;

      (b)  not issue any form of assessment against Asia 4D Company Limited on the same audit issues including with reference to the Applicant’s audit issues and with reference to the two Respondent’s letters, both dated 9 October 2020 and Asia 4D Company Limited tax representative’s letter dated 27 October 2020 for future years of assessment including the year of assessment 2019 until the winding up of Asia 4D Company Limited;

      (c)  not issue any form of assessment against the Applicant on the same audit issues as the matter of these proceedings for future years of assessment including the year of assessment 2019 until the winding up of the Applicant; and

      (d)  Upon submission of the relevant documents to the Respondent in the future, the Respondent will issue the letter of clearance for the Applicant and Asia 4D Company Limited to facilitate their winding up process. This is on the basis that there are no other issues other than the same audit issues in the present proceedings and as outlined above in Items (6)(a) and (6)(b). The Respondent reserves the right to review if there are issues other than the same audit issues in the present proceedings and as outlined above in Items (6)(a) and (6)(b).

Following the filing of the Consent Order, the Applicant will not pursue its judicial review application before the Labuan High Court and the Respondent will withdraw its corresponding appeal before the Court of Appeal.

Despite the years of assessment covered under the Consent Order being from 2014 up to the winding up of the Applicant and Asia 4D Company Limited, the current accounting standard does not allow these prior years’ matter being treated as prior year adjustments and as such there will be a one-off and non-recurring adverse financial impact of 5.66 sen to the Group’s Basic Earnings Per Share and Net Assets Per Share.

With the above Consent Judgment, the dispute between the Applicant and the Respondent had been settled amicably.

This announcement is made on 31 December 2020.