March 20, 2020 / 6:32 AM / 17 days ago

Malaysia's AirAsia says review found Airbus procurement process robust

KUALA LUMPUR (Reuters) - AirAsia Group Bhd (AIRA.KL) said on Friday an independent probe into corruption allegations from Britain’s Serious Fraud Office (SFO) has found the Malaysian airline’s procurement process with European planemaker Airbus SE (AIR.PA) robust and justifiable.

FILE PHOTO - AirAsia Airbus A320-200 planes are seen on the tarmac of Kuala Lumpur International Airport 2 (KLIA2) in Sepang, Malaysia, February 4, 2020. REUTERS/Lim Huey Teng

In a filing to the stock exchange, AirAsia said Airbus’ sponsorship of a sports team the airline’s top executives co-owned was at the relevant time disclosed to and supported by the board of AirAsia Bhd (AAB), since renamed AirAsia Group.

“The sponsorship showed demonstrable benefits to the AirAsia Group and was not linked to any purchase decisions by AAB,” the group said.

The board has therefore reinstated Chief Executive Tony Fernandes and Chairman Kamarudin Meranun, co-owners of the now-defunct Formula One racing team who stepped aside due to the matter on Feb. 3, the group said.

It said independent reviewer BDO Governance Advisory also found that AirAsia’s sponsorship of a sports team complied with procedures.

AirAsia earlier this year became embroiled in allegations that Airbus’ $50 million (42.4 million pounds) sponsorship was aimed at influencing the group’s aircraft acquisition.

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

AirAsia said the two executives had properly disclosed interests to the board of directors and had abstained from discussions relating to the sponsorship.

The Malaysian Anti-Corruption Commission has previously said it would look into the SFO allegations. The agency did not respond to a request on Friday for an update on its investigation.

Malaysia’s Securities Commission also said it would examine whether any securities laws had been breached. In a response to Reuters, the regulator said the matter was currently being reviewed and it was not at liberty to comment further.

Reporting by Liz Lee; Editing by Stephen Coates and Christopher Cushing/Emelia Sithole-Matarise

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