AirAsia bosses take 2-month break amid graft probe

KUALA LUMPUR — AirAsia Group (AAGB) chief executive officer Tan Sri Tony Fernandes and its executive chairman, Datuk Kamarudin Meranun have relinquished their executive positions within the company for two months, effective immediately, in the wake of an Airbus bribery probe.

AirAsia, in a statement on Monday (Feb 3) evening, also announced that its board of directors has formed a non-executive independent board committee comprising the non-executive members of the board.

It said that based on the committee’s recommendation, Mr Tharumalingam Kanagalingam has been appointed as the acting CEO of AAGB in the interim.

Mr Kamarudin and Mr Fernandes, meanwhile, would be redesignated as AAGB’s non-independent non-executive board members.

The company said Mr Kamarudin and Mr Fernandes have notified the committee of their decision.

“(They) have notified the Committee that they will relinquish their executive positions within the Group, effective immediately, for a period of two months or such other period that the Company may deem fit.

“The Committee has decided that in view of the current difficult economic circumstances facing the airline industry, to retain them as advisors to the Company during this two month period.

“As advisors, they will not have executive authority within the Group,” said the company.

The AirAsia Group has been drawn into controversy following allegations by the United Kingdom’s Serious Fraud Office (SFO) that Airbus paid a bribe of US$50 million (S$68.4 million) to win plane orders from Asia's largest budget airline group.

The SFO document also claimed that Airbus had offered another US$55 million to sponsor a sports team linked to two unnamed executives from the airlines.

The document read AirAsia and AAX ordered 406 aircraft from Airbus between October 2005 and November 2014.

This included 180 aircraft secured during the indictment period by way of improper payment made by Airbus and the offer of a further improper payment.

The allegations were revealed on Friday as part of a record US$4 billion settlement Airbus agreed with France, Britain and the United States. Prosecutors said the company had bribed public officials and hidden payments as part of a pattern of worldwide corruption.

The Malaysian Anti-Corruption Commission (MACC) on Saturday announced it would investigate the allegations implicating two executives of the airlines.

MACC chief commissioner Latheefa Koya confirmed that the graft-buster was in touch with authorities in the UK, and was already probing the corruption allegations.

The following day, the Securities Commission announced that it would examine the graft allegations.

SC chairman Datuk Syed Zaid Albar said the SC would review all available evidence to determine if there was any breach of securities laws as the low-cost carriers were listed on Bursa Malaysia.

AirAsia had since denied that it was involved in any way whatsoever with the SFO’s investigation of Airbus nor given any opportunity to provide any information or clarification to the SFO.

“The entering into of each aircraft purchase agreement was never made by any single individual decision, but instead arrived at through careful evaluation, deliberation and the collective decision of the board members after taking into account technical specifications, aircraft flight performance and operating economics,” the company had stated on Sunday.

It said it would cooperate with the MACC investigation. NEW STRAITS TIMES