I wrote several times about Tanjung Offshore: here, here and here.
The Independent committee announced its findings.
The Maritime Executive wrote the following commentary:
Malaysia’s Tanjung Offshore has suspended three top executives after an internal inquiry into possible misconduct.
The company released a statement saying the suspensions were made on the recommendation of an independent committee.
Tan Sri Tan Kean Soon and Muhammad Sabri bin Ab Ghani have been suspended from their executive roles with immediate effect, but remain as directors of the company. Non-Independent Director Tan is a paid advisor of Tanjung, while Sabri is Executive Director.
Dato Harzani bin Azmi’s services as a paid advisor to the company have also been suspended with immediate effect. His earlier nomination to the board of directors shall not be considered, the company said in a statement.
Tanjung will hold further investigations into the findings of the independent committee which included several instances of possible conflict of interest and breach of fiduciary duty by Tan and Sabri, both individually and together, and possible breaches of procedure and limits of authority by Harzani among other matters.
The independent committee was formed on January 8, 2015 by the board to conduct an internal review following speculative media articles and purported complaints to the authorities against the company.
The possible conflicts of interest and breaches of fiduciary duty may have resulted in, among others, loss of business opportunity and potential income stream related to the Bourbon deal. A proposed asset injection by Bourbon Offshore Asia Pacific was mutually terminated in December 2014, following changes in the prevailing economic, financial and market conditions including declining oil prices.
The possible conflicts and breaches may also have resulted in disadvantageous and lopsided terms for a contract under negotiation, and potential future loss related to a Construction Work Request (CWR) project worth about RM250 million ($69 million).
These possible conflicts and breaches also may have been the cause for the dissemination of confidential company information to third parties related to both the Bourbon deal and the CWR project. These could also be potentially jeopardizing the company’s relationship with CNPC Offshore Engineering (CPOE) in China in on-going negotiations for a drilling contract in Malaysia.
The board will seek legal advice on its next course of action, and will make the appropriate reports to the authorities wherever necessary, said Tanjung.
It must be noted that in the official announcement of the company the link between the three suspended directors and the alleged misconduct is not made, most likely because of legal issues (everyone is presumed innocent until proven guilty).
We can safely assume that the authorities (SC and/or BM) are also on this case, possible conflict of interest (without announcing it) and breach of fiduciary duties of directors are quite severe.