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Tanjung Offshore to clean house after forensic audit report

Tanjung Offshore to clean house after forensic audit report
Troubled Malaysian oil and gas service provider Tanjung Offshore has vowed to put its house in order and clean up its corporate governance issues following a Ferrier Hodgson forensic audit report, local reports said.

Group ceo and executive director Rahman Shamsudin said the audit results pointed to shortcuts as well as shortcomings, which then led to the weaknesses in corporate governance, including the botched deal with offshore supply vessel player Bourbon.

The company said that it had also accepted the recommendations given by its Special Task Force, which was formed to study the next course of action, adding that the recommendations would shape how the company would proceed with various deals.

“The audit specifically focused on six deals raised by minority shareholder complaints citing a lack of transparency, queries by Bursa Malaysia, a probe by the Malaysian Anti-Corruption Commission and police reports,” Tanjung Offshore noted.

These deals were the proposed reverse takeover by Bourbon, the deal to acquire the remaining shares in Gas Generators (Gastec), the purchase of property in Birmingham, a failed chromite project in the Philippines, an ethylene propylene diene monomer project in China, and a construction work request that did not materialise.

However, Rahman said the audit was a good starting point for the company as it sought to put itself on a more solid footing.

“This move was aimed at strengthening corporate governance within the group, taking a cue from recommendations of a forensic audit by Ferrier Hodgson triggered by several 'contentious transactions',” he added.

In a further development Tanjung Offshore also said it would lodge official complaints to the Malaysian Anti-Corruption Commission (MACC) on its Gastec deal and UK property transaction and engage external lawyers to review the terminated reverse takeover of the company by Bourbon as well as to review the ethylene propylene diene monomec (EPDM) project in China and the failed chromite project in the Philippines.

This contrasts with initial position in a January announcement that said an independent committee had found no improprieties or discrepancies on Gastec and UK property deals.