TPG disputes ATO tax claim

The Australian Taxation Office has sought to freeze TPG's accounts in Australia, alleging the private equity firm owes A$452m in taxes on the proceeds of the sale of its stakes in Myer Group.

TPG Capital has disputed claims from the Australian Taxation Office (ATO) that it owes A$452.2 million ($422.7 million; €282.3 million) in unpaid taxes from the recent IPO of portfolio company Myer Group.

Last week, the ATO attempted action against TPG, which it claims owes the money in capital gains tax on the proceeds of the sale of its shares in portfolio company Myer Group, which listed on the Australian Securities Exchange at the end of October. The ATO sought to freeze TPG’s accounts.

The ATO has also attempted to slap the firm with an A$226.1 additional penalty, or 50 percent of the assessment, for allegedly avoiding tax, The Australian newspaper reported. 

TPG said in a statement it has at all times complied with Australian taxation laws and will continue to do so in the future.

“While we have not been contacted by the Australian Tax Office regarding the matter raised by the ATO yesterday, we intend to cooperate fully with any inquiry they make as we have done so in the past,” the statement read.

TPG led a consortium including Newbridge Capital and the Myer family office to acquire the Myer retail business for $A1.4 billion in 2006. TPG subsumed its Asian affiliate Newbridge Capital later in 2006.

Myer raised A$2.2 billion through its IPO in October, which saw a complete exit for its private equity owners, TPG and Blum Capital. Prior to the IPO, TPG and Blum Capital, which also had a stake in Newbridge, held a combined stake of 84.2 percent in the company, according to Reuters. It is estimated TPG received A$1.3 billion when it sold its stake in the Myer float, having recouped all of its initial investment prior to the flotation.

Myer shares, which were sold at A$4.10 in the offfering, were trading at A$3.92 at time of press.