KUALA LUMPUR (April 29): Mudajaya Group Bhd (KL:MUDAJYA) confirmed on Tuesday that its Indian unit and independent power producer, RKM Powergen Ltd, was raided by local authorities in early February this year over an alleged fraudulent acquisition.

In a filing to the exchange, Mudajaya stated that the search was conducted by the Enforcement Directorate (ED) based on an investigation initiated by the Central Bureau of Investigation (CBI).

The search included RKM's Chennai business premises, the residential property of its managing director and CEO, and six other companies linked to the individual.

Mudajaya said the investigation pertains to the alleged fraudulent acquisition of the Fatehpur East Coal Block in Chhattisgarh, which was allocated by the Ministry of Coal for the power sector back in 2008.

RKM is accused of wrongdoing related to the cancelled coal block allocation and fraudulent transactions involving Mudajaya Corporation Bhd (MCB) and MIPP International Bhd concerning its equity participation in RKM.

Mudajaya holds a 19.24% stake in RKM through MCB, while MIPP is a former subsidiary of MCB.

On Thursday, Mudajaya noted that the CBI has been investigating the matter since 2010, which led RKM to file a writ petition against the ED in 2021. Pursuant to this, the court issued a writ of mandamus restraining the ED from exercising its power.

Following the recent raids, RKM has filed writ petitions, with hearings starting on Feb 7, 2025.

The writ petitions were heard in court over several dates in February, March and April 2025, and in the recent hearing of April 28, 2025, the case has been further postponed to a later date yet to be advised.

The group added that the ED’s Additional Solicitor General assured that no further action would be taken until the petitions are fully heard.

Mudajaya also clarified that MGB is not involved in the ongoing ED investigation, and none of its directors or officers are part of it.

It further assured that the independent power plant business operations are running smoothly, with no impact on its financial position.

At the midday break on Tuesday, Mudajaya's shares were unchanged at 9.5 sen, giving it a market capitalisation of RM252.45 million.