Malaysian offshore oilfield services provider, Tanjung Offshore has pledged to clean up weaknesses identified by a forensic audit and has accepted the auditors’ recommendations.
The recommendations were highlighted by Ferrier Hodgson’s forensic audit report that commenced on 20 March 2015.
The report listed six deals raised by minority shareholders and sought to address shareholders’ complaints about lack of transparency, queries by Bursa Malaysia , a probe by the Malaysian Anti-Corruption Commission (MACC) and police reports.
The deals under question were a MYR34.3 million (USD9.1 million) payment to Bourbon for its subsidiary Gastec , a purchase of a property in Birmingham for MYR62.7 million and a chromite project in the Philippines which involved MYR6.2 million. In addition, the audit will also look into Tanjung Offshore’s investment of MYR3.2 million in an ethylene propylene diene monomer (EPDM) project in China and a construction project.
Tanjung Offshore has engaged lawyers to review the failed Bourbon deal and to seek a legal opinion. Initially, the company was planning to bid for Talisman’s contract with Bourbon but the transaction fell through as Tanjung Offshore was bound by a three-year moratorium not to be involved in the offshore supply vessel business.
Meanwhile, the company will also engage a lawyer to review its Gastec deal and seek legal views as to whether there was wrongdoing in the transaction. The deal is under investigation by MACC, as allegations were made that a substantial portion of the sale proceeds from Gastec was used to purchase shares in one listed company, which should have been declared to the board of directors.
“The recommendations by the forensic audit and subsequently, the in-depth study by Tanjung Offshore’s special task force is a good starting point as the company seeks to put itself on a more solid footing,” said Tanjung Offshore CEO Rahman Shamsudin.